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China is 'Taking Advantage' of Unreliability From Washington, Says Eurasia Group's Ian Bremmer - Bloomberg Radio
Feb 10, 2026 Latest Videos from Bloomberg Radio
Ian Bremmer, Founder & President at Eurasia Group, discusses US foreign policy's role in the current global world order.
Chinese regulators have advised financial institutions to rein in their holdings of US Treasuries, citing concerns over concentration risks and market volatility, according to people familiar with the matter.
Officials urged banks to limit purchases of US government bonds and instructed those with high exposure to pare down their positions, the people said, asking not to be identified discussing private deliberations. The directive doesn’t apply to China’s state holdings of US Treasuries.
Communicated verbally to some of the nation’s biggest banks in recent weeks, the guidance reflects growing wariness among officials that large holdings of US government debt may expose banks to sharp swings, the people said. The worries echo those made by governments and fund managers elsewhere amid a brewing debate over the safe haven status of US debt and the appeal of the dollar.
The move was framed around diversifying market risk rather than anything to do with geopolitical maneuvering or a fundamental loss of confidence in US creditworthiness, the people said, adding that officials didn’t given any specific target on size or timing. While significant tensions remain between Beijing and Washington, relations have steadied in the wake of a trade truce last year.
Treasuries slipped on the news, with yields edging higher across maturities in Asian afternoon trading. The dollar weakened slightly against major peers.
The initial selling on the report on China’s holdings was limited, said Kathleen Brooks, research director at XTB.
“If China was to ditch their Treasuries in a large-scale selling program, this would cause US and global yields to spike and would cause major disruption to the global economy,” she said.
“The bond market is taking the view that China won’t do this, and if they do reduce the size of their Treasury holdings they will do this in a slow and gradual way. Hence why yields are mostly stable so far.”
China-based investors’ holdings of Treasuries have halved to $682.6 billion, the lowest level since 2008, from a peak of $1.32 trillion reached in late 2013, according to official US data. Still, Belgium — whose holdings are usually taken to include Chinese custodial accounts — has seen its Treasury ownership quadruple since the end of 2017 to $481 billion. Taken together with Chinese holdings of US agency bonds and equities, the Asian nation’s outstanding investment in American securities has remained relatively stable since late 2023. China is the third-largest foreign holder of Treasuries, after Japan and the UK.
Ian Bremmer, Founder & President at Eurasia Group, discusses US foreign policy's role in the current global world order.
Chinese regulators have advised financial institutions to rein in their holdings of US Treasuries, citing concerns over concentration risks and market volatility, according to people familiar with the matter.
Officials urged banks to limit purchases of US government bonds and instructed those with high exposure to pare down their positions, the people said, asking not to be identified discussing private deliberations. The directive doesn’t apply to China’s state holdings of US Treasuries.
Communicated verbally to some of the nation’s biggest banks in recent weeks, the guidance reflects growing wariness among officials that large holdings of US government debt may expose banks to sharp swings, the people said. The worries echo those made by governments and fund managers elsewhere amid a brewing debate over the safe haven status of US debt and the appeal of the dollar.
The move was framed around diversifying market risk rather than anything to do with geopolitical maneuvering or a fundamental loss of confidence in US creditworthiness, the people said, adding that officials didn’t given any specific target on size or timing. While significant tensions remain between Beijing and Washington, relations have steadied in the wake of a trade truce last year.
Treasuries slipped on the news, with yields edging higher across maturities in Asian afternoon trading. The dollar weakened slightly against major peers.
The initial selling on the report on China’s holdings was limited, said Kathleen Brooks, research director at XTB.
“If China was to ditch their Treasuries in a large-scale selling program, this would cause US and global yields to spike and would cause major disruption to the global economy,” she said.
“The bond market is taking the view that China won’t do this, and if they do reduce the size of their Treasury holdings they will do this in a slow and gradual way. Hence why yields are mostly stable so far.”
China-based investors’ holdings of Treasuries have halved to $682.6 billion, the lowest level since 2008, from a peak of $1.32 trillion reached in late 2013, according to official US data. Still, Belgium — whose holdings are usually taken to include Chinese custodial accounts — has seen its Treasury ownership quadruple since the end of 2017 to $481 billion. Taken together with Chinese holdings of US agency bonds and equities, the Asian nation’s outstanding investment in American securities has remained relatively stable since late 2023. China is the third-largest foreign holder of Treasuries, after Japan and the UK.
