China Ousts Japan as Biggest Holder of US Treasuries


China has re-emerged as the world’s biggest holder of US government debt following five consecutive months of gains in its holdings of Treasuries.

The US Treasury’s latest monthly report indicates that China’s holdings of US government bonds, notes and bills saw an increase of USD$44.3 billion in June compared to the preceding month to reach $1.15 trillion in total.

During the same period Japan’s holdings fell by $20.5 billion to $1.09 trillion.

This means that China is once again the world’s biggest sovereign creditor to US government, after ceding the position to Japan in October last year.

US government data further indicates that China and Japan jointly account for one-third of US government debt held abroad, which increased $47.7 billion in June to reach $6.17 trillion in total.

China’s foreign reserves saw their six consecutive month of increase in July to reach $3.08 trillion, spurred by continued appreciation of the yuan as well as robust economic performance.