China’s US Treasury holdings hit 18-year low in April

China’s US Treasury holdings slipped to $651.1 billion in April, extending a yearslong retreat that has cut its portfolio roughly 14% since early 2025, according to Reuters.reuters
Japan raised its holdings to $1.21 trillion and the UK to $938 billion, lifting total foreign Treasury ownership to $9.353 trillion despite China’s drawdown.reuters
Foreigners made net purchases of $206 billion in long-term U.S. securities in April, suggesting broad global demand remains intact even as Beijing diversifies reserves.investing

China Trims US Treasury Holdings to 18-Year Low as Other Foreign Buyers Step In

China’s holdings of US government debt slipped to their lowest level in more than 18 years in April, extending a years-long divestment trend even as overall foreign demand for Treasuries edged higher, according to data released by the US Treasury Department on Thursday.

Beijing’s Slow Retreat

China’s Treasury holdings fell to $651.1 billion in April, down from $652.3 billion in March, marking the lowest level since September 2008, according to the Treasury International Capital report. The decline is part of a broader pattern: China’s Treasury portfolio has shrunk by roughly 14% since the start of 2025, when holdings stood near $759 billion. Analysts have attributed the sustained sell-off to Beijing’s strategy of diversifying its foreign reserves away from dollar-denominated assets.reuters

The April reduction was modest compared to March, when China shed approximately $41 billion in a single month amid what Reuters described as an energy crisis that compelled central banks to liquidate dollar reserves to stabilize local currencies.cnbc

Global Appetite Holds

Despite China’s pullback, total foreign holdings of US Treasuries rose to $9.353 trillion in April from $9.348 trillion in March, though they remain below the record $9.49 trillion set in February. Japan, the largest foreign holder, increased its position to $1.21 trillion from $1.19 trillion, while the United Kingdom’s holdings climbed to $938 billion from $927 billion.investing

Foreign residents made net purchases of $206 billion in long-term US securities during April, with private investors accounting for $164.4 billion and official institutions contributing $41.6 billion.reuters

Shifting Dynamics

China has fallen to the third-largest foreign holder of US Treasuries, behind Japan and the UK. The trend reflects what economists view as a deliberate rebalancing by Beijing, which has channeled reserves into gold and other non-dollar assets in recent years. Yet the broader data suggests that appetite for American sovereign debt remains robust globally, with total foreign holdings up 4% compared to a year earlier.benzinga