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China dumping American debt – US Treasury data

Samizdat | July 19, 2022

China’s holdings of US treasury securities dropped below $1 trillion in May for the first time in more than a decade, information released by the US Department of the Treasury shows. Official data is regularly published with a two-month delay.

China, the second largest foreign holder of US government debt, has reduced its holdings for six consecutive months from $1.08 trillion last November to $980.8 billion in May. That’s a decline of nearly $100 billion, or 9%. The last time China held less than $1 trillion of US treasury securities was in May 2010 ($843.7 billion).

Japan, the largest foreign holder of US government debt, has also decreased its holdings recently. In the six months from November to May, it dropped by nearly $116 billion to $1.212 trillion.

The total US national debt was just above $30.4 trillion as of last month. Washington has been struggling to contain skyrocketing inflation that hit a 41-year high at 9.1% in June. The US Federal Reserve hiked its benchmark interest rate by 0.75 of a percentage point in June, triggering warnings of a possible recession. Another increase could be introduced in an upcoming meeting next week.

According to CNBC, rising interest rates have made US treasury securities potentially less attractive, but the decline in China’s share could also be attributed to Beijing working to diversify its foreign debt portfolio.

July 19, 2022 - Posted by | Economics | ,

3 Comments »

  1. With inflation and interest hikes bonds are money losers.

    Liked by 1 person

    Comment by Bob Dobbs | July 19, 2022 | Reply

  2. Well, it’s about dam’ time….

    I fully expect this “dumping” to accelerate and become an avalanche of discarded dollars….

    Is possible that even Japan is facing reality and perceiving that it is “riding the wrong horse” in its neighborhood Asian region and around the world? Is the wannabe hegemon USA-ZioWest about to meet its fiscal comeuppance, its imperial clothes stripped off and nakedness exposed for all to see?

    Interesting times, these. I’m staying attuned insofar as possible, finger in the wind, to the geopolitical-financial et al air currents swirling here, there, everywhere. I look forward to continued Samizdat analyses and reports of statistical/measurable data points and trends!

    Liked by 2 people

    Comment by roberthstiver | July 19, 2022 | Reply

  3. The USA just keeps printing money, as if, it’s a sound way of marching into the future. Crunch time cannot be too far away, and I imagine the Chinese have recognised it. Why is nobody questioning America’s National Debt?

    Liked by 2 people

    Comment by brianharryaustralia | July 19, 2022 | Reply


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