China Hiked US Debt Holdings to 1.17Trl, Interest Down for Four Years01-17 11:37 Caijing
China has increased its holdings of U.S. debt for the second month in November by 14.3 billion U.S. dollars following an increase of 7.9 billion in October, boosting its total to 1.17 trillion U.S. dollars, according to revised data published by the U.S. Treasury on Wednesday.
While remaining the largest owner of U.S. debt, China has been trailing by Japan in the amount of holdings, whose hit 1.13 trillion U.S. dollars ending November. Japan was long the largest foreign owner of U.S. debt until China eclipsed it in 2008.
China added 18.2 billion U.S. dollars of U.S. debt in the first 11 months in 2012, Treasury data showed. It increased holdings by 14.3 billion, 20.4 billion and 13 billion in January, April, and July, respectively, while cutting 22.2 billion combined in February and March; 17.4 billion in May and June, and 6.4 billion in August and September.
Japan has bought 215 billion U.S. dollars in U.S. government debt in the past year, bringing its total holdings to 1.12 trillion U.S. dollars. The Caribbean countries and regions trailed behind Japan with 283.7 billion of holdings.
Share, interest down
|Source: U.S. Treasury Department.|
China has dramatically increased its holdings over the second half of the past decade. Based on November's data, the U.S. government borrows about 2.1 U.S. dollars from China for every 10 dollars of its public debt.
Despite that, China's holdings as a percentage of U.S. public debt have declined since 2010 after peaking at about 12 percent and the amount of interest it gets from U.S. government has decreased since 2008 as a result of declining interest rates.
A calculation by the The Washington Post showed that U.S. taxpayers paid about 30 billion U.S. dollars to China last year in interest, compared to the average of 37.5 billion in the previous five years, and the figure is likely to fall even more this year.
The newspaper said U.S. policymakers are alarmed by U.S.' dependence on borrowing from China, its major rival who is catching up with US as the world's second-biggest economy. President Obama, who said early in his term that "we can't keep on just borrowing from China."
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