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Sylvia Ma

China cut its holdings of US Treasuries to an 18-year low in July, as overall holdings by foreign countries fell for a second consecutive month amid deepening worries over the sustainability of American government debt.
China’s holdings fell to US$618 billion in July from US$633.4 billion in June, data released by the US Treasury Department showed on Wednesday.
The July figure was the lowest level since August 2008, when its holdings tumbled to US$573.7 billion, according to Chinese financial data provider Wind.
Meanwhile, overall foreign holdings of US Treasuries dropped to US$9.25 trillion in July, down from US$9.3 trillion in June, the US Treasury Department said.
In July, persistent concerns over the sustainability of Washington’s finances – with investors demanding greater compensation for holding US government debt over longer horizons – continued to weigh on long-term US Treasuries, pushing 30-year Treasury yields to their highest level since 2007.
In late July, Washington and Tokyo intervened to stem the Japanese yen’s slide, marking their first joint yen-buying intervention since 1998, with observers widely speculating that US involvement might also help limit selling pressure on US Treasuries.
Among other major Treasury holders, Japan, the largest foreign holder of US debt, cut its holdings to US$1.1 trillion in July from US$1.12 trillion in June, while the United Kingdom’s holdings rose to US$998.3 billion from US$939.9 billion, official data showed.


Long-term bond yields continued to rise even after the US Treasury Department said last week that it would buy back up to US$6 billion of long-dated debt – a move widely seen as an effort to support the market and ease pressure on longer-term yields. The 10-year Treasury yield climbed above the 5 per cent mark on Monday, for the first time since 2023, and has hovered around that level since.
Meanwhile, the impact of the US Federal Reserve’s decision on Wednesday to increase interest rates by a quarter of a percentage point due to inflation concerns – the first rate increase in over three years – remained a key focus for investors.
China slipped to third place among foreign holders of US Treasuries in March last year – behind Japan and the UK – continuing a gradual but uneven retreat that began during US President Donald Trump’s first term amid rising tensions and concerns over the weaponisation of the US dollar.
In contrast to its broader sell-off of US debt, China has steadily added to its gold reserves, widely viewed as a hedge against geopolitical and financial risks.
Official data showed the People’s Bank of China increased its bullion holdings for the 22nd consecutive month in August, bringing the total to 76.73 million troy ounces.


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Persistent concerns over sustainability of Washington’s finances see overall foreign holdings shrink for second consecutive month


Persistent concerns over sustainability of Washington’s finances see overall foreign holdings shrink for second consecutive month.


China cuts US Treasury holdings to 18-year low amid global bond sell-off

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Persistent concerns over sustainability of Washington’s finances see overall foreign holdings shrink for second consecutive month

Persistent concerns over sustainability of Washington’s finances see overall foreign holdings shrink for second consecutive month