China has steadily accumulated U.S. Treasury securities over the last few decades. As of November 2024, the Asian nation owned $768.6 billion in Treasuries (bonds issued by the federal government), which is the main form of U.S. debt to China.
Some analysts and investors fear China could dump these Treasuries in retaliation and that this weaponization of its holdings would send interest rates higher, potentially hurting economic growth. The amount of Treasuries China holds has been decreasing since 2018. This article discusses the business behind China buying U.S. debt.
Key Takeaways
- China invests heavily in U.S. Treasury bonds to keep its export prices lower.
- China focuses on export-led growth to help generate jobs.
- To keep its…
