According to figures out this morning from the Treasury Department, China was a net buyer of Treasuries in April for the first time in six months.
In other words, purchases of U.S. Treasury securities by China accounted for just over 14 percent of the new debt issued by the U.S. government during that period.
Just a week ago, former Fed Chairman Alan Greenspan joined the chorus about the unlikelihood of China dumping Treasury holdings.
Meanwhile, Japan, the second-largest foreign holder of U.S. Treasury bonds (after China), will likely have to sell off some those investments to finance disaster relief and reconstruction efforts.
Treasury Secretary Henry Paulson recently commented that all of China's U.S. treasury bond holdings represent less than one day's volume of trading on global bond markets.
Doing so would have required Treasury to open formal negotiations with China on the issue.
One of the reasons why China has so much Treasury holdings is because of trade.
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The President noted that Treasury Secretary Jacob Lew will visit China next week and that Secretary of State John Kerry will also visit Beijing in the coming weeks as part of his upcoming trip to Asia.
Meanwhile, China has trimmed its US Treasury holdings for three months in a row.
Tim Geithner, the treasury secretary, is surprisingly confident that China will act.
Henry Paulson is clearly a capable man and, but for his ties to China, would bring to Treasury stature and skills that are much needed.
None of that has changed--in fact, the latest evidence is that China is again mopping up Treasury notes--but what's coming into clearer focus is that the Chinese have their own internal imbalances that are no less difficult to correct.
As I understand it, our national public debt was borrowed, in US dollars, from India and China in the sale of Treasury securities purchased with the US dollars that came from the sales of consumer goods in trade imbalance that has lasted for better than a decade.
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China's purchases of American Treasury bonds, along with purchases by Japan, have helped to hold down yields and hence American mortgage rates.
China often decreases its load of Treasury debt during any given month.
The vote comes only days before Treasury Secretary Henry Paulson is due to visit China to discuss the currency situation and other economic issues.
Professor JOHNSON: Well, there would be less holding or less purchases by China of U.S. Treasury notes if there's an effect on that current account.
Next week, Treasury Secretary Geithner will go to Japan and China.
In those talks, Treasury Secretary Henry Paulson is expected to press China to let its currency adjust higher while pressing for better enforcement of copyright and patent laws.
And it would mean China could continue to buy US Treasury securities at a cheaper price to make up for the declining value of the dollar, which hit a new low for the past several decades today.
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Goldman Sachs has been heavily involved in China, also important experience for the Treasury post.
Interest rates will spike as investors from China to Germany demand higher rates for Treasury paper.
As for the Treasury bills, dumping them is not an option for China: a tumbling dollar would hurt its own economy (see article).
America's Treasury says that because of the higher inflation rate in China, the yuan is in effect appreciating against the dollar by more than 10% a year.
China reduced its holdings of U.S. Treasury bonds in March, the U.S. Treasury Department said on Wednesday.
His national security adviser, his treasury secretary, and his commerce secretary have all been to China recently.
He believes investors like China will continue to buy U.S. Treasury securities.
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