Key facts
- China's Treasury holdings fell to $590.7 billion in August, an 18-year low.
- Total foreign ownership of U.S. Treasuries increased by $83.3 billion in August.
- China remains the third-largest reported foreign holder of U.S. Treasuries, behind Japan and the United Kingdom.
China reduced its reported holdings of U.S. government debt to $590.7 billion in August, marking an 18-year low, according to U.S. Treasury data released October 16. This decrease occurred even as total foreign ownership of American Treasuries rose by $83.3 billion in the same month. The divergence suggests that China's reduction does not necessarily indicate a collapse in international demand for U.S. debt. While China and Japan reported significant declines, investors through Canada, Britain, and Belgium increased their exposure. China's portfolio is now approximately 55% smaller than its 2013 peak. The United States must continuously refinance its obligations, with its national debt exceeding $40 trillion.