China Dumps $18,900,000,000 in Treasuries as US Government Faces Major Dilemma: Macro Analyst Luke Gromen

China sold off billions of dollars worth of US Treasuries between February and March, according to new government data.

An update from the Treasury Department shows China’s US Treasury holdings dropped $18.9 billion in one month, while most other countries increased their holdings.

The data also shows that the UK has overtaken China and is now the second-biggest foreign holder of USTs in the world.

Japan remains the biggest holder of USTs in the world, currently holding $1.13 trillion, down from $1.16 trillion a year prior.

Macro investor Luke Gromen warns that the countries buying more USTs won’t be able to simultaneously buy more American-manufactured goods, further hurting America’s trade deficit that President Trump has promised to address.

Says Gromen,

“Foreign UST holdings rose $133 billion Mar vs. Feb.

UK, Caymans, and Canada were $86 billion of that $133 billion; China sold $19 billion.

UK surpassed China as the 2nd biggest US foreign creditor for 1st time ever in March.

Cayman Islands (pop. ~73,000) is now the fourth biggest US foreign creditor at $455 billion…

How are they going to buy both USTs and more goods from America going forward?”

Analysts reportedly told Reuters that Chinese holdings of USTs have been in a downward trajectory since 2018, even though foreign holdings of Treasuries surged to an all-time high of $9.05 trillion in March.

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