Home›Global Markets›Trade & Tariffs›China’s push to reduce US dollar assets could shift fi…

China’s push to reduce US dollar assets could shift financial risk

Economists quoted by SCMP say China’s US Treasury cuts and yuan expansion were likely raised around the Xi-Trump talks even though they were unlikely to appear in any formal agreement.

Reported · Written up by our desk · Trade & Tariffs

After a summit between President Xi Jinping and US President Donald Trump that focused on tariffs, agricultural quotas, and critical minerals, an additional issue lingered, China’s gradual diversification away from US dollar assets.

According to SCMP Economy, Beijing has been cutting its holdings of US Treasuries while seeking to expand the yuan’s global use and build alternative financial architecture, issues that may not have been included in the summit’s official communique.

SCMP Economy also cites Charles Chang, a finance professor at Fudan University, who said the topics of China’s US debt holdings were likely to have been discussed, but he added they were unlikely to be covered through a formal agreement like those used for trade.

Chang said sovereign debt management involves capital allocation and is highly sensitive, which makes it less likely to be addressed in official statements even if it remains closely watched by investors and policymakers.

More like this

Sources