China U.S. Treasury Holdings August

Numbers are out on the Chinese U.S. treasury holdings.

In August 2012 China held $1.154 trillion in U.S. treasuries. Nothing much has changed other than that Japan almost has more U.S. treasuries than China.

Chart 1: China U.S. Treasury Holdings

As China holds its U.S. treasury holdings steady, the Chinese yuan has rallied somewhat against the U.S. dollar. I wonder what they will buy with these valuable yuan if they are not buying U.S. treasuries.

Chart 2: USD/CNY

Who is Holding the U.S. Bonds?

These days, we hear much talk about how low the interest rates are on U.S. government bonds (TLT, DTYL). Many say that this is because the Federal Reserve is printing money to buy up its own bonds. But actually, it’s the foreigners that are buying up all the treasury debt.

In this analysis I will go through the most recent facts about U.S. government bonds and we will see that one of the most important charts to follow is this one. It will tell you the exact time when to sell U.S. government bonds.

Chart 1: Debt held by Foreigners