Key facts
- Global approval of the U.S. has reached its lowest point since 2002, according to a Pew Research Center survey.
- The U.S. has been downgraded from a 'liberal democracy' to an 'electoral democracy' by V-Dem.
- Foreign investors hold $9.32 trillion in U.S. Treasuries.
- Norway's sovereign wealth fund plans to reduce its U.S. Treasury holdings by approximately $75 billion.
- Japan is the largest foreign holder of U.S. debt, with $1.11 trillion in Treasuries as of June.
The United States' standing as a global economic anchor is facing increasing skepticism worldwide, driven by President Donald Trump's policies on debt accumulation and sanctions, according to reports from Foreign Affairs and El País.
Since Trump's return to office in January 2025, international disapproval of U.S. policies has reached levels not seen in recent history. A Pew Research Center survey across 36 countries indicates that attitudes toward the U.S. are at their most negative since the center began tracking them in 2002. This sentiment extends beyond policy disagreements, with a growing number of non-Americans questioning the fundamental state of American democracy and its respect for individual liberties.
This erosion of faith in U.S. leadership is compounded by concerns over the nation's fiscal health. Foreign investors and central banks collectively hold $9.32 trillion in U.S. Treasuries, a significant portion of which finances America's deficits. The recent climb in Treasury yields, driven by persistent inflation and expectations of further interest rate hikes, presents a dilemma for these creditors, as rising yields lead to falling bond prices and potential losses on existing investments.
Norway's sovereign wealth fund has signaled this concern by announcing a reduction in its U.S. Treasury holdings, a move expected to involve approximately $75 billion. While much of this capital may be reinvested in other U.S. fixed-income assets, the decision highlights the growing unease among major foreign holders of U.S. debt. Japan, the largest foreign creditor, holds $1.11 trillion in Treasuries, but rising yields on its own government bonds may offer domestic alternatives, potentially altering its role as a key financier of U.S. debt.