Thursday, 16 May 2019 10:24

China is Dumping Treasuries to Punish the US

Written by
Rate this item
(8 votes)

(Beijing)

China is beginning its retaliation against the US’ increasing intense trade policy. The country is unloading its holdings of US Treasuries at the fastest pace in two years alongside the big rupture with Washington over trade. Its US Treasury bond holdings are one of China’s arsenal of weapons to retaliate against the US’ tariff hikes. According to Deutsche Bank’s chief economist, “The sheer size of [China’s] reserves and that this is even becoming a conversation means the market should take it seriously”. The country owns $1.12 tn worth of Treasuries.


FINSUM: This is quite a risk for the US as someone would have to absorb all those sold assets, and if they flooded the market, it would cause major volatility and sharp yield rises.

Contact Us

Newsletter

Subscribe

Subscribe to our daily newsletter

Top
We use cookies to improve our website. By continuing to use this website, you are giving consent to cookies being used. More details…