Under 1 trillion U.S. debt held by China fell by $1.1 billion for the first time in 12 years, amid rising interest rates that have made U.S. Treasuries less attractive.
Continuing a trend that began in early 2021, China’s holdings of U.S. government bonds fell in May to $980.8 billion, according to U.S. Treasury data.
That’s a drop of nearly $23 billion from April, and down $100 billion, or 9%, from a year ago.
It also marks the first time since May 2010 that China’s holdings of US Treasuries fell below $1 trillion. dollars. Japan is now the largest holder of US Treasuries, with 1.2 trillion. dollars.
The decline comes as the U.S. central bank has raised interest rates to stem rising inflation, which is at its highest level since 1981.
It is even attributed to Beijing trying to diversify its foreign bond portfolio.
Source: Capital
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