China slashed holdings of US Treasuries for a seventh consecutive month in June, Treasury department data released on Monday showed. Its holdings of US government debt fell to $967.8 billion in June, the lowest since May 2010 when it held $843.7 billion and compared to $980.8 billion in May.
Since hitting a roughly 20-month high in mid-May, the US dollar has been largely stable against the Chinese yuan, sliding about 1%. The dollar was last up 0.5% at 6.7755 yuan . There is an added wrinkle between US-China relations involving Taiwan, a self-governed island China claims as its own, but that is not reflected just yet in the data, which covers the June numbers.
Japan increased its holdings of Treasuries to $1.236 trillion in June, from a revised $1.224 trillion in May. The Treasury report released in July showed Japan had $1.213 trillion in Treasuries for the month of May.
Overall, foreign holdings of Treasuries rose to $7.430 trillion in June from a revised $7.426 trillion in May.
On a transaction basis, U.S. Treasuries saw net foreign inflows of $58.9 billion in June, compared with inflows of $99.84 billion the previous month. US Treasuries have posted foreign inflows for a second straight month.
The inflows was generally in line with price action in the Treasuries market. The benchmark 10-year Treasury yield started June at 2.9310% , and ended the month at 2.974% down about 4 bps.