(Yicai Global) June 16 -- Against the backdrop of growing signs of yuan stabilization, China's holdings of US Treasury bonds reached their highest level in six months in April.
China's holdings of US government bonds, notes and Treasury bills increased by USD4.6 billion in April to USD1.1 trillion, the third consecutive month of growth. It is still the US' second-largest overseas creditor. Japan remains the largest foreign holder of US government bonds, down USD12.4 billion to USD1.11 trillion in April, the monthly report released by the US Treasury June 15 shows China has recently begun to shift of its move to cut US Treasury bonds last year, and is prepared to gradually increase its holdings of US debt at the appropriate time because of the increased attractiveness of US Treasuries and the stability of the yuan exchange rate, Caixin media quoted insiders as saying June 6.
China's foreign exchange reserves rose in May for the fourth straight month, the longest record since June 2014, as the yuan appreciated and capital controls curbed capital outflows. The external reserve balance increased last month by USD24 billion to USD3 trillion, the largest increment since April 2014, data released by the People's Bank of China in May shows.