China reduces its investments in US Treasury bonds to May 2009 lows 2024-02-24 09:20:39

Meanwhile, total foreign holdings of US securities reached the highest level since December 2021.

China continues to unload its US Treasury bonds, reducing its investments to $805.4 billion in August, the lowest since May 2009, according to data from the US Treasury Department. cited by Reuters.

According to Gennadiy Goldberg, head of US interest rate strategies at New York-based TD Securities, the objective of the selling may lie in the need to stabilize the yuan. However, “it is not clear if this was for monetary purposes because Chinese reserves have not gone down, which is strange,” he added.

Meanwhile, total foreign holdings of US bonds rose to $7.707 trillion, the highest level since December 2021. The largest holder is Japan, with $1.1116 trillion. According to Goldberg, despite the fear that foreign investors will withdraw, the truth is that they continue to buy US Treasury bonds.

“The biggest fear is that they may withdraw in the coming months, especially when the deficit grows, which makes many investors nervous,” he highlighted.

In August, the yield on the 30-year US Treasury bond was reported to have hit 4.42%, surpassing its peak last year and reaching its highest level since 2011.