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Foreign holdings of Treasuries fall in June, led by Japan drop

Overseas Treasuries holdings declined by $72.1 billion in June to $9.3 trillion, with Japan down about $26.4 billion to $1.12 trillion and China down $25.9 billion to $633.4 billion.

Reported · Written up by our desk · Government Bonds

Foreign holdings of US Treasuries fell in June from the prior month, driven mainly by declines in positions held by Japan and China, according to data published by the US Treasury Department.

Overseas Treasuries holdings dropped by $72.1 billion in June to a total of $9.3 trillion, and the holdings have fallen in three of the past four months since a record high in February. The broader environment has included losses in US government bonds, amid investor concerns about large budget deficits and inflation above target levels. The Treasury data reflect both valuation changes and net purchases or sales.

Japan, the largest holder, recorded the biggest decline, with holdings down about $26.4 billion to $1.12 trillion in June. The article links the move to pressure on Japan’s yen and Tokyo’s currency interventions, adding that Washington coordinated in late July after Treasury Secretary Scott Bessent announced a rare joint intervention.

For China, the second-largest decline in June was $25.9 billion, taking its Treasuries stockpile down to $633.4 billion. Market-watchers cited in the article suggested the intervention approach was aimed at reducing the risk that Japan would otherwise sell Treasuries to defend the yen, potentially pushing up US borrowing costs.

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