China is selling US Treasury bonds to buy more US bonds. About it on my Telegram channel Wrote economist, professor at the Higher School of Economics Evgeny Kogan.
“In reporting on China’s active sale of US government bonds, the media often misinterpret the situation and present it as an attempt to get rid of the securities of Beijing’s economic adversary. If you look at what China spends its income on, the picture is different,” he said.
According to him, China can use some of the revenue to support the yuan exchange rate or to cover the budget deficit. However, according to the results of last year, mostly US agency bonds were purchased. We’re talking about investments in these securities increasing by $55 billion over the year.
He added that after the market revaluation, China’s net purchases of US bonds reached $122 billion in 2022. That is, we are talking about investments in another US government debt, which turned out to be more profitable than ordinary government bonds.
Data published on the US Treasury website on December 16 testifiedHe said that the volume of Russian investments in US government bonds in October slightly exceeded $ 2 billion, and at the same time, from the spring of 2018, Russia began to sharply reduce its investments in US government bonds. Then, levels dropped from $96 billion to $48.7 billion in April 2018 and to $14.9 billion in May.