Selling for 5 months China United States treasuries over the hundreds of billions

Selling for 5 months, China United States treasuries over the hundreds of billions of dollars, global liquidity turning Flash

United States Treasury holds in major countries United States national debt amount

December 15 United States Treasury data show China October plunge $41.3 billion in United States Treasury bonds, fell to $1.1157 trillion total debt, its lowest since July 2010. Japan October holdings of $4.5 billion, total debt of us $1.1319 trillion. That month Japan overtook China as United States biggest creditors.

Starting from June, China for 5 months to reduce United States Treasury bonds, June, July, August, September, October holdings respectively, for $3.2 billion, $22 billion and $33.7 billion, $28.1 billion and $41.3 billion, for a total reduction of $128.3 billion.

China’s foreign exchange reserves fell beginning in 2014, is now down to about $3 trillion, or 25%, the offshore renminbi against the US dollar has fallen by about 15%. Is widely regarded as a move to trump the cyclone the next trend of the dollar, central banks in order to shore up its currency. Chinese private enterprises in Argentina kind

China is not the only nation to a sharp reduction in debt. Besides China, Belgium, and Saudi Arabia and other countries is also selling treasuries. United States well-known financial blog Zero Hedge analysis shows that, in view of Belgium and China very similar debt reduction path, started trading speculation China has hosted in Belgium of us debt.

Report showed that in May 2016, 5 months of the end of October 2016, foreign creditors, holders of United States total debt fell from $6.28 trillion to $6.04 trillion, for 1-year low; official holdings fell to 3.8415 trillion from 4.0374 trillion, the same 1-year record low. It is obvious that central banks, sovereign wealth funds and official agencies are in liquidation of United States Treasury bonds. Bond yields in more than two-year high, indicating States under the Trump fiscal stimulus, United States of issuing treasury bonds in the future concerns.

Has happened to reduction of the national debt? United States Treasury data for August showed that buying is a private investor. October report showed foreign private purchases of us debt amounted to $60.5 billion, buying US $18.8 billion, and foreign official institutions a net reduction of $41.7 billion.

Trump to launch 1 trillion dollars of debt the whirlwind, and now the Fed will start raising interest rates. Investors looking at the term Trump to see faster United States growth, is the dollar along with soaring debt rising long-term yields.

China institutes of contemporary international relations director Liu Junhong to the surge of globalization News noted, “if we could determine that the new recovery in the world economy and other investable assets, also predicts the Treasury will be selling, selling treasuries will be the right choice. ”

Liu Junhong predicts dollar devaluation will occur after Trump came to power, as the United States’s largest creditor, the yen will become Japan’s problems. United States Cornell University economics professor and former International Monetary Fund (IMF) China Division Chief Eswar Prasad believes that Chinese buying United States Treasury for the United States budget and current-account deficit to provide adequate, affordable financing and those days may have come to an end.

Shanghai’s new financial Lee Thunderbolt to the press that the surging of the Academic Board of the Institute, mainly because of the emergence of this trend is that the Fed raised interest rates, normalization of monetary policy and global liquidity inflection, holdings of treasuries to avoid United States Treasury prices fall flight. “As foreign exchange reduced, the Central Bank also took the opportunity to tighten policy, reducing the money supply and through reverse repurchase and the MLF (medium-term borrowing facilities), including releasing liquidity into the market. With no extra money, bond and stock holdings, global liquidity inflection point, interest rates will gradually rise. ”

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