China has apparently cut the portion of its currency reserves help in US debt. Perhaps the world’s most populous nation wants to pressure the richest one on trade and military issues. Perhaps the People’s Republic is tired of US human rights and open internet pressure.
If China is trying to bargain with the US through sovereign paper ownership, it has not worked. The demand for Treasuries as a “safe haven” has pushed yields to multi-year lows.
China has made a sharp shift away from purchases of U.S securities, slashing the dollar’s share of the country’s foreign reserves in what may signal a change in strategy for managing the massive cash pile, Dow Jones calculations indicate.
The portion of China’s reserves parked in the U.S. appears to have sunk to a decade-low 54% as of end-June from 65% in 2010 and 74% in 2006, according to the Dow Jones calculations.
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