Chinese holdings of US Treasuries increased to the highest since 2019, amid rising yields and a strong economic rebound.
According to latest data released by the Treasury Department on Thursday, China’s Treasury holdings rose by $9 billion in February to a total of $1.1 trillion— the highest since July 2019. This marked the fourth consecutive month of growth, and the longest duration of investments in over four years. China’s purchases also accumulated during the least favourable quarter for US Treasuries since the 1980s, as the benchmark 10-year yield rose to around 1.4% in February.
The increase in Treasury purchases came at a time when China’s economy reopened for exports ahead of all other major economies, leading to a significant influx of cash. This increase in money likely prompted the country to go on a US Treasury buying spree. In the meantime, despite an ongoing robust economic recovery, US Treasuries were volatile once again on Thursday, as the 10- and 30-year yields fell to the lowest level in the past month.
Information for this briefing was found via the US Treasury Department. Thee author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.