China’s Holdings of Treasuries Slump to Lowest Level Since July
- Holdings of Japan reached also dropped, hitting four-year low
- Two countries account for one-third of foreign-held Treasuries
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China’s holdings of Treasuries fell to a four-month low even as its foreign-exchange holdings increased in November, in a potential sign the world’s second-largest economy is curbing its appetite for U.S. government debt.
China’s Treasury holdings are attracting extra attention after Bloomberg News reported last week the government was considering tapering its purchases of U.S. government debt. A pullback by America’s largest foreign creditor could put upward pressure on interest rates just as tax cuts may increase the U.S.’s need to issue more Treasuries to fund the deficit.