Several members of the economic alliance known as BRICS are discarding billions of dollars worth of assets backed by the US government.
New numbers from the Treasury Department show China is leading the charge, reducing its holdings of US treasuries from $835.4 billion in June to $821.8 billion in July – a decrease of $13.6 billion in one month.
Even though the country is still the second-largest foreign holder of US treasuries around the world, China has now unloaded a total of $117.4 billion worth of US government debt in a 12-month period.
Looking at Brazil, the South American nation pared its stash of US treasuries from $227.4 billion in June to $224.7 billion in July, a decline of about $2.7 billion.
India has also reduced its US treasury holdings to the tune of $2.3 billion over the same period.
Meanwhile, oil-rich nation the United Arab Emirates saw its US treasury trove drop by $300 million from $65.2 billion in June to $64.9 billion in July.
According to a recent report from Nikkei Asia, China is trimming its US treasury to defend the yuan against a strong US dollar. This month, the Chinese yuan (CNY) fell to $0.136 versus the US dollar, a level last seen in January 2008.
When a country sells US treasuries, the billions of dollars collected from the sale may serve as capital for the nation’s central bank to accumulate the local currency on the open market in an effort to boost its value.Don't Miss a Beat – Subscribe to get email alerts delivered directly to your inbox
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