Story perspectives

China Slashes US Treasury Holdings, Shifts Focus to Gold

9/20/2025

Summary

Story summary

In July 2025, China reduced its US Treasury holdings by $25.7 billion, bringing the total to $730.7 billion, the lowest level since 2009.
This marks China's fourth decrease in 2025, with holdings below $1 trillion since April 2022.
Japan and the UK increased their US Treasury holdings, remaining the largest and second-largest foreign holders.
Analysts indicate China may shift to European assets and gold for diversification due to US dollar stability concerns.
By August 2025, China's foreign exchange reserves rose to $3.322 trillion.

History

Historical Context

The global financial crisis of 2008 led to significant changes in international investment, with China holding a record $1.3 trillion in US Treasuries by 2009. As of 2025, a $25.7 billion reduction in these holdings indicates China's strategic shift towards asset diversification amid concerns over the US dollar's stability, potentially increasing global market volatility and prompting reevaluation of investment strategies by major economies.

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Story summary

In July 2025, China reduced its US Treasury holdings by $25.7 billion, bringing the total to $730.7 billion, the lowest level since 2009.
This marks China's fourth decrease in 2025, with holdings below $1 trillion since April 2022.
Japan and the UK increased their US Treasury holdings, remaining the largest and second-largest foreign holders.
Analysts indicate China may shift to European assets and gold for diversification due to US dollar stability concerns.
By August 2025, China's foreign exchange reserves rose to $3.322 trillion.

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