The United States government is deepening its reliance on foreign powers to finance its swelling obligations as the national debt soars to new record levels.
The latest data from the Treasury Department shows that overseas holdings of US debt have reached a record $9.13 trillion as of June 2025.
At the top of the list is Japan, holding $1.147 trillion worth of Treasuries, followed by the United Kingdom with $858.1 billion and China with $756.4 billion. Other countries owning large amounts of US debt include the Cayman Islands with $442.7 billion, Canada with $438.5 billion and Belgium with $433.4 billion.
In total, the US national debt has now shattered $37 trillion, underpinning the growing weight of foreign financing in America’s balance sheet.
Despite the rising levels of US debt, a $1.3 trillion asset manager believes that Treasuries will remain in high demand due to the current macroeconomic landscape. According to Northern Trust, policy uncertainty in the UK and low yields on debt offered by the Japanese government have driven the two countries to seek shelter in the Treasury market.
“While nations and investors may continue to fine-tune their strategies in response to evolving market and geopolitical realities, US public debt is likely to remain a benchmark that anchors global fixed-income markets. As long as the dollar perseveres as the world’s reserve currency, the benefits of holding this highly liquid asset will prevent a large-scale exit. Of course, the US must do its part to preserve confidence in Treasuries. As much as foreign investors need the safe-haven asset, the US also needs foreign investors to fund its rising deficit.”
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