Japan, China Cut Holdings of U.S. Bonds at Low Level

Japan and Communist China shrank their holdings of U.S. Treasuries to multi-year lows in May, U.S. Treasury data showed on Monday.

Japan’s holdings of U.S. Treasuries fell to $1.212 trillion, the lowest since January 2020, when the country held $1.211 trillion. In April, Japan’s holdings were at $1.218 trillion.

Communist China’s holdings of U.S. bonds also fell to $980.8 billion in May, still the lowest since May 2010, when the Communist regime’s holdings of Treasuries were at $843.7 billion, the data showed. In April, the Chinese Government had $1.003 trillion U.S bonds.

The world’s second-largest economy has cut its holdings Treasuries for six straight months.

Overall, foreign holdings of U.S. Treasuries slipped to $7.421 trillion in May from $7.455 trillion in April, the lowest since May 2021.

Treasuries saw a net foreign inflow of $99.84 billion in May, the largest since March 2021, compared with an outflow of $1.153 billion in April.

Among other asset classes, foreigners sold U.S. stocks in May for a fifth straight month amounting to $9.15 billion, expanding from the $7.04 billion sell-off in April. The S&P 500 has fallen nearly 20% since the start of the year.

In May, overseas purchases of U.S. corporate bonds were 4.46 billion, much lower than the $22.5 billion purchased in April.