November 19, 2018
Still the biggest foreign holder of the US foreign debt, China slashed it’s share by nearly $14 billion, with the country’s holdings falling to $1.15 trillion from nearly $1.17 trillion in August, according to the latest data from the Treasury Department. The fall marks the fourth straight month of declines. China is followed by Japan, whose share of US Treasuries fell to $1.03 trillion, the lowest since October 2011.
Washington has accelerated the Treasury issuance to avoid potential growth in the federal deficit due to the massive tax cut pushed by President Donald Trump, as well the federal spending deal approved by the government in February.
Chinese purchases of US state debt have been decreasing over recent months. The latest drop comes on top of the escalating trade conflict between Beijing and Washington over trade imbalance, market access and alleged stealing of US technology secrets by Chinese corporations. So far, the US has imposed tariffs on $200 billion of Chinese goods and Beijing retaliated with tariffs on $60 billion of US goods and stopped buying American crude.
The parties are reportedly set to resume trade talks at the G-20 meeting of the world’s developed economies that will begin in Argentina on November 30. So far, Beijing has presented a list of possible concessions. On Friday, the US president said he would leave out “four or five” of the big items the US wants.
“China wants to make a deal. They sent a list of things they are willing to do, which is a large list and it is just not acceptable to me yet. But at some point I think that we are doing extremely well with respect to China,” Trump told reporters.
This article was posted: Monday, November 19, 2018 at 7:58 am