China’s Holdings of Treasuries Dropped in 2016 by Most on Record

  • Japan’s portfolio decreased for a fifth consecutive month
  • ​Treasury data show Japan as top U.S. foreign creditor in 2016

China’s holdings of U.S. Treasuries declined by the most on record last year, as the world’s second-largest economy dipped into its foreign-exchange reserves to buttress the yuan. Japan, America’s largest foreign creditor, trimmed its holdings for a second straight year.

A monthly Treasury Department report released in Washington on Wednesday showed China held $1.06 trillion in U.S. government bonds, notes and bills in December, up $9.1 billion from November but down $188 billion from a year earlier. It was the first monthly increase since May.

Sarah McGregor & Andrea Wong | Bloomberg

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