China has continued to slash its holdings of US treasury securities amid the growing threat of economic sanctions from Washington, according to data released by the US Treasury on Wednesday. The figures show that Beijing's holdings slid to $859.4 billion in January from $867.1 billion in December.
The decline in January was more than double the $3.1 billion cut the month before, though less than the $7.8 billion reduction in November.
China is the second largest foreign holder of US government debt but has reduced its holdings for six consecutive months, with the figure dropping below the symbolic $1 trillion mark in April 2022.
The decrease comes amid Beijing’s efforts to diversify its portfolio and reduce dependence on the US dollar while promoting broader international use of the Chinese yuan amid the threat of sanctions, the South China Morning Post reports.
China has already trimmed its holdings by 34.1% over the past ten years, including a 16.6% cut in 2022 based on US data, deputy director of the Department of International Finance at the Institute of Finance and Banking Zhang Ming told the SCMP.
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