How much U.S. Treasury does China hold now?

According to the data, as of November 2020 (the U.S. bond holding data will be delayed by two months), the total size of U.S. bonds held by China was US$1,063 billion, ranking second largest overseas holder of U.S. Treasury bonds after Japan.

Between 2016 and 2019, China's total holdings of U.S. Treasury bonds remained in the trillions range. As of April 25, 2020, China's total holdings of U.S. Treasury bonds have reached one trillion dollars.

At present, China holds trillions of dollars in US Treasury bonds, China is the largest creditor of the United States, the second largest creditor of the United States is Japan, which holds trillions of US dollars, and China and Japan hold more than one-third of the total US Treasury bonds held by major foreign creditors.

According to data released by the U.S. Treasury Department, China's holdings of U.S. Treasury bonds fell to one trillion dollars as of 2020. China's holdings of U.S. debt fell by $9.3 billion, making it the country with the largest decline in U.S. debt, but China remains the second largest creditor of the United States. As of now, the debt of the United States is trillions of dollars, and the ratio of GDP to GDP is very close, which is very close to the internationally recognized warning line of 120%.

China holds more than a trillion dollars in U.S. Treasury bonds.

By 2023, China's total holdings of U.S. Treasury bonds will exceed one trillion dollars, nearly $1 trillion more than in 2018. According to data released by the U.S. Treasury Department on May 24, China's total holdings of U.S. Treasury bonds amounted to $100 million as of March 31, 2020, up from 2019. On the other hand, according to the Ministry of Finance, China's holdings of US Treasury bonds will continue to increase in the coming years.

By 2023, China's holdings of U.S. Treasury bonds will reach $100 million, nearly $1 trillion more than in 2018.

Reasons for China's purchase of US Treasury bonds:

China wants to be able to use U.S. Treasuries to protect against capital flows in international markets. On the one hand, U.S. Treasury bonds are the most trusted national bonds by investors, with good liquidity and can maintain investment stability in the long run. On the other hand, China has purchased U.S. Treasury bonds to avoid the impact of exchange rate exercises and the continuous loss of foreign exchange reserves.

As a result, China is very cautious in investing in U.S. Treasury bonds to ensure the safety of its capital.

Risks of China's Holding of U.S. Treasuries:

1. If inflation occurs in the United States, then the yield of China's holdings of US Treasury bonds will be greatly reduced, because there is a positive proportional relationship between the yield of US Treasury bonds and inflation.

2. China's holdings of U.S. Treasury bonds are greatly affected by fluctuations in foreign exchange rates, because the value of the U.S. dollar relative to the Chinese yuan is constantly changing, and once the U.S. dollar depreciates, the income from the U.S. Treasury bonds invested in will be greatly reduced. <>

In May 2021, data released by the U.S. Treasury Department showed that Shengyuan China still holds about a trillion dollars in U.S. Treasury bonds, still the second largest holder of U.S. Treasury bonds.

China began large-scale purchases of U.S. Treasury bonds in the 80s of the 20th century and has been one of the largest holders of U.S. Treasuries for decades since. Prior to 2000, China was one of the largest overseas holders of U.S. Treasuries, but after the U.S. introduced the QE2 tax cut program in 2000, China began to reduce its holdings of U.S. Treasuries.

During the 2008 financial crisis, China again increased its holdings of U.S. Treasuries and has since been one of the largest overseas holders of U.S. Treasuries. However, since 2018, when Trump introduced a tax cut plan, China began to reduce its holdings of U.S. Treasuries.

By 2021, China's holdings of U.S. Treasury bonds had fallen to a trillion dollars, accounting for only one of the balance of U.S. Treasury bonds. This proportion has been on a downward trend in recent years, reflecting the gradual rationalization of China's investment in U.S. Treasury bonds.

Overall, China's holdings of U.S. Treasuries have been increasing over the past few decades, but have now reached a certain size. With the gradual rationalization of China's investment in U.S. Treasury bonds, the amount of U.S. Treasury bonds held by China may further decrease in the future.

According to the U.S. Treasury Department's September 2022 International Capital Flows Report (TIC), as of September 2022, Chinese mainland's holdings of U.S. Treasury bonds amounted to US$933.6 billion, and its total holdings fell to its lowest level since June 2010.