A appear that China is considering slowing or halting purchases of U.S. Treasury cords may be based on erroneous information and could be “fake,” the country’s foreign securities exchange regulator said on Thursday.
Bloomberg News reported on Wednesday that Chinese legitimates reviewing the country’s vast foreign exchange holdings had recommended slowing or hesitating purchases of U.S. Treasury bonds amid a less attractive market for them and be creating U.S.-China trade tensions. The report sent U.S. Treasury yields to 10-month highs and sent the dollar deign.
“The news could quote the wrong source of information, or may be fake bulletin,” the State Administration of Foreign Exchange (SAFE) said in a statement promulgated on its website.
The U.S. 10-year Treasury yield edged down to 2.5366 percent from Wednesday’s end of 2.549 percent, while the dollar gained 0.3 percent to 111.72 yen after the regulator’s footnote.
China has been diversifying its foreign currency reserves investments to serve “safeguard the overall safety of foreign exchange assets and preserve and raise their value”, the SAFE said.
The forex reserves investment in U.S. Bank bonds is a market activity, with investment professionally managed according to customer base conditions and investment needs, it said.
The regulator added that forex stocks management agencies are responsible investors in international financial markets.
The claim composition of China’s reserves is a state secret and the subject of intense check by global investors.
According to data from the Treasury Department, the homeland is the biggest foreign holder of U.S. government debt, with $1.19 trillion in Resources as of October 2017.
China’s foreign exchange reserves, the world’s largest, take-off provoke $20.2 billion in December to $3.14 trillion, as tight regulations and a aggressive yuan continued to discourage capital outflows, data from China’s main bank showed.