China’s holdings of US Treasuries fell for the fifth consecutive month in October, as demand for US government debt falls across the board, the Financial Times reports.
China, the largest holder of Treasuries, lowered its holdings of the Treasuries by $12.5 billion, taking its total holdings back down to levels not seen since mid-2017.
Foreign reserve managers sold a total of $42.6 billion of US government debt with a more than one-year maturation period in October.
The falling demand for US debt is a concern due to the country’s rising debt levels due to the Trump administration’s tax cuts. If demand falls too far, this will put upward pressure on interest rates.