China Slashes U.S. Bonds to Lowest Since 2008
The figures underscore a deepening fracture in the global debt landscape: while the rest of the world is doubling down on American bonds, Beijing is quietly but steadily walking away.
Foreign holdings of US Treasuries climbed from $8.6 trillion at the close of 2024 to $9.3 trillion by December 2025 — a 7.5% surge in just twelve months. Roughly 42% of that sum is controlled by official institutions including central banks, with the balance spread across private and institutional investors.
Japan holds its crown as the single largest foreign creditor, expanding its portfolio by 11.7% year-on-year to reach $1.2 trillion. The UK trails in second place at $866 billion — also up 11.7% — reflecting London's deepening footprint in American public debt markets.
China, once firmly entrenched in that second-place position, has charted a starkly different course. Its Treasury holdings contracted from $759 billion in December 2024 to $638.5 billion by year-end 2025 — a roughly 10% decline that marks the lowest exposure since the global financial crisis. Over five years, the retreat is even more striking: Beijing has shed approximately 36% of its holdings from a peak of around $1.1 trillion in 2020. Chinese regulators have reportedly directed financial institutions to scale back their exposure to US government debt, citing unease over concentration risk and market turbulence.
Filling the void left by China are Belgium and Canada, which ranked among the most aggressive buyers over the period. Belgium grew its holdings from $374.6 billion to $477.3 billion — an 88% jump over five years — while Canada nearly tripled its stake, rising from $378.8 billion to $468.1 billion between end-2024 and end-2025. The UK's five-year gain was even more dramatic, surging 97% from $440.6 billion.
Zooming out further, global foreign ownership of US Treasuries has risen 31% since the end of 2020, when total holdings stood at $7.1 trillion.
Padhraic Garvey, regional head of research for the Americas at ING Financial Markets, told Anadolu that China has been a net seller of US Treasuries for several years, offloading roughly $400 billion in holdings since 2020. He attributed the trend to China's narrowing current account surplus, a strategic push to reduce reliance on US government paper, and possible geopolitical motivations. Despite the scale of Beijing's retreat, Garvey noted that robust demand from other nations has absorbed the pressure, preventing any significant disruption to markets.
Legal Disclaimer:
MENAFN provides the
information “as is” without warranty of any kind. We do not accept
any responsibility or liability for the accuracy, content, images,
videos, licenses, completeness, legality, or reliability of the information
contained in this article. If you have any complaints or copyright
issues related to this article, kindly contact the provider above.
Legal Disclaimer:
EIN Presswire provides this news content "as is" without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the author above.
