China's Holdings Of US Treasury Bonds For 4 Consecutive Months

The US Treasury recently released the latest report on international capital flows, which showed that China held 1 trillion and 154 billion 100 million U.S. dollars in the end of 2 in 2011, representing a decrease of 600 million US dollars compared with 1 trillion and 154 billion 700 million dollars at the end of 1.

This means that China reduced its US Treasury bonds by 600 million US dollars in February.

From October 2010 to February 2011, China has reduced its holdings of US Treasury bonds for a total of 21 billion 200 million US dollars for four consecutive months.

Overall, China has accumulated a total of US $21 billion 200 million in US $4 in the past 4 months, of which $5 billion 400 million has been reduced in January.

But since June 2010, the amount of Treasuries held by China has exceeded $1 trillion per month.

Although there has been a reduction in recent years, the number of treasury bonds held by China has not fluctuated significantly, and the overall balance has been maintained.

Second of Japan and third of Britain have been overweight since June 2010.

From June 2010 to February 2011, Japan increased its holdings of US Treasury bonds to US $90 billion 400 million to US $890 billion 300 million, and the UK increased US $201 billion to US $295 billion 500 million.

Similarly, there are fifth countries in Brazil. From June 2010 to February 2011, the total holdings totaled $30 billion 500 million and Canada ranked eleventh. In the same period, it increased by 57 billion US dollars, from 35 billion 900 million US dollars to 92 billion 900 million US dollars, an increase of 159%.

For a long time, US dollar assets are the main configuration of China's foreign exchange reserves.

As of the end of 3 this year, the balance of foreign exchange reserves was the world's largest, reaching 3 trillion and 44 billion 700 million US dollars, up 24.4% over the same period last year.

At the end of December 2010, the amount of treasury bonds held by our country accounted for about 41% of the total foreign exchange reserves.

The central bank's 2010 international financial market report said that in 2011, the overall trend of the US dollar may be weak due to factors such as slow economic recovery, low interest rates and "double deficits".

However, the risk of European sovereign debt crisis still exists and geopolitical risk is likely to spread. These factors are conducive to achieving a stronger stage in the overall weakness of the US dollar.

But on the other hand, the United States has yet to get out of the excessive fiscal deficit.

Although the US Republican and democratic parties reached a government budget and temporarily avoided the closure of the government, the federal debt of the United States had nearly reached the legal limit of $14 trillion and 250 billion.

According to the data released by the Ministry of finance, foreign investors account for 31.4% of the total federal debt.

For a long time, dollar assets have been relatively high in foreign exchange reserves.

Many industry insiders said that we should speed up the diversification of China's foreign exchange reserves and increase investment in gold and commodities.

Yi Gang, vice president of the people's Bank of China and director of the State Administration of foreign exchange, explained that when the diversification of asset allocation was taken into account, it would be considered, but in terms of market capacity, investment should still be more prudent.

Yi Gang said that China has been promoting diversification of foreign exchange reserves for many years.

Diversification has largely ensured the safety and stability of foreign exchange reserve assets.

Yi Gang said that the diversification of external reserves in currency diversification, a basket of currencies, the main convertible currencies, reserve currencies, emerging market currencies have; in asset allocation, as long as assets meet the requirements of security, liquidity, profitability, will also be taken into account.