China reduced its US Treasury holdings in October to its lowest level in 17 years, as mounting concerns over US debt sustainability and the Federal Reserve’s independence further eroded confidence in dollar-backed assets.
The country’s stockpile fell to US$688.7 billion in October, down from US$700.5 billion in September, according to US Treasury Department data released on Thursday.
October’s figure was the lowest level reported since November 2008, and marked a plunge of more than 47 per cent from the nearly US$1.32 trillion peak reached in November 2013, according to Chinese financial data provider Wind.
In March, China slipped to third place among foreign Treasury holders – behind Japan and the United Kingdom – continuing the gradual, albeit uneven retreat that began during US President Donald Trump’s first term.
In an article published on Tuesday, Yu Yongding, a former adviser to China’s central bank, warned of growing risks tied to US dollar assets.
