Chinese researchers lodge concerns over US debt as Beijing limits exposure
'Although US Treasuries have not yet reached the default threshold, their expansion is unsustainable,' researchers from the Bank of China wrote in the latest issue of China Money, a publication supervised by the People's Bank of China, the country's central bank.
With this concern in mind, China has been trimming its US Treasury holdings for three consecutive months, while keeping them roughly unchanged at the US$756 billion level in June, according to data released on Friday by the US Treasury Department. This remains the lowest level since March 2009.
The researchers noted that US economic growth would be unlikely to offset rising debt from persistent budget and trade imbalances, warning that US President Donald Trump's efforts to narrow the trade deficit could
curb global demand for the US dollar and undermine the currency's international role.
This, they said, would put the country in a 'tug-of-war', oscillating between its economic and monetary priorities.
'Uncertainty over tariff, tax and fiscal reforms, coupled with a potential US dollar credibility crisis and speculation over the
Mar-a-Lago Accord , could heighten volatility in the US Treasury market,' they said.
'[We need to] gradually adjust US Treasury holdings and appropriately increase reserves of gold, key resources and strategic materials.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
South China Morning Post
8 minutes ago
- South China Morning Post
How Beijing's proposed new embassy in London could benefit Britain
In a world increasingly defined by digital diplomacy and virtual communication, the persistent struggle over bricks and mortar might seem like an old-fashioned skirmish. However, the ongoing saga of China's proposed new embassy in London, England, proves that physical buildings remain potent symbols of power, prestige and national ambition. The dispute over the diplomatic compound is more than just a planning row; it is a microcosm of the complex, often fraught relationship between the UK and China, and a revealing test of Britain's domestic capacity and international standing. For centuries, diplomatic buildings have been a powerful statement of a country's prowess. These structures convey national ranking, cultural confidence and even taste. A new, large-scale embassy signifies a nation's rising status and its commitment to a long-term presence in a host country. The UK understands this well, though its recent history offers a cautionary tale. Some have accused Britain of 'selling the family silver', citing the disposal of prime diplomatic real estate for financial gain. The sale of its embassy in Bangkok, Thailand, for a record £420 million (US$569 million) in 2018, and a partial sale of its compound in Tokyo, Japan, for £685.7 million in 2022, have apparently been used to fund upgrades elsewhere. However, this short-term approach stands in stark contrast to China's long-term focus on the art of diplomacy. China's planned embassy in London is slated to be located at the former Royal Mint site. The plan is to transform the historic five-acre plot into a state-of-the-art diplomatic hub. This project sends a clear double message. First, by committing to such a colossal presence, China signals that it considers London a critically significant global capital, a key partner in finance, trade and diplomacy. Second, the sheer scale and modernity of the proposed building project serve as a powerful visual metaphor for China's rise as a global superpower. The proposal has been met with some political opposition. Experts at the Centre for Strategic and International Studies have cited what they see as the national security risk of the embassy being on top of sensitive cables running through one of the world's most important financial centres, though these concerns come off as spy paranoia.
South China Morning Post
3 hours ago
- South China Morning Post
Newsmax agrees to pay US$67 million in defamation case over 2020 election claims
The conservative network Newsmax will pay US$67 million to settle a lawsuit accusing it of defaming a voting equipment company by spreading lies about US President Donald Trump's 2020 election loss, according to documents filed on Monday. The settlement comes after Fox News Channel paid US$787.5 million to settle a similar lawsuit in 2023 and Newsmax paid what court papers describe as US$40 million to settle a libel lawsuit from a different voting machine manufacturer, Smartmatic, which also was a target of pro- Trump conspiracy theories on the network. Delaware Superior Court Judge Eric Davis had ruled earlier that Newsmax did indeed defame Denver-based Dominion Voting Systems by broadcasting false information about the company and its equipment. But Davis left it to a jury to eventually decide whether that was done with malice and, if so, how much Dominion deserved from Newsmax in damages. Newsmax and Dominion reached the settlement before the trial could take place. The settlement was disclosed by Newsmax in a new filing with the US Securities and Exchange Commission. It said the deal was reached on Friday. 'Newsmax believed it was critically important for the American people to hear both sides of the election disputes that arose in 2020,' the company said in a statement. 'We stand by our coverage as fair, balanced and conducted within professional standards of journalism.'
RTHK
7 hours ago
- RTHK
Wang Yi arrives in India to bolster ties
Wang Yi arrives in India to bolster ties Wang Yi will hold talks with Indian Foreign Minister Subrahmanyam Jaishankar during his visit to New Delhi. File photo: Reuters China's top diplomat landed in India on Monday, seeking to bolster long-fraught relations in the face of intense pressure and tariffs from the United States. Foreign Minister Wang Yi will hold talks with his counterpart Subrahmanyam Jaishankar, and is also expected to meet Prime Minister Narendra Modi during his three-day visit to New Delhi. Modi, according to Indian media, might also visit China this month. India's foreign ministry said in a social media post that "important engagements of the India-China Special Representatives and on bilateral relations" were scheduled over the next two days. Restarting border trade across their icy and high-altitude Himalayan border is expected to feature high on Wang's agenda. Its resumption would be significant for its symbolism, and follows agreements to return direct flights and issue tourist visas. (AFP)
