China looks like it's dumping Treasury debt but may actually be stashing it in Canada and Belgium
China is suspected of using a vault relocation strategy to conceal its U.S. Treasury investments while official data shows a sharp decline. While China's reported holdings hit an 18-year low in August, coinciding with a drop to $591 billion, stockpiles in Canada and Belgium have surged. Canada's holdings rose to $465 billion in August from $169 billion five years ago, and Belgium's stash grew from $228 billion to $490.5 billion. These shifts suggest Beijing is stashing debt in overseas custodial accounts to avoid transparency and mask the true extent of its U.S. debt exposure.
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- ✓ Canada's U.S. Treasury holdings reached $465 billion in August, up from $169 billion five years prior.
- ✓ China's reported U.S. Treasury holdings reached an 18-year low in August.
What changed
New data reveals a correlation between China's reported Treasury divestment and rapid stockpile increases in Canada and Belgium.
Live updates
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China may be hiding U.S. Treasury holdings in Canada and Belgium
China is suspected of using a vault relocation strategy to conceal its U.S. Treasury investments while official data shows a sharp decline. While China's reported holdings hit an 18-year low in August, coinciding with a drop to $591 billion, stockpiles in Canada and Belgium have surged. Canada's holdings rose to $465 billion in August from $169 billion five years ago, and Belgium's stash grew from $228 billion to $490.5 billion. These shifts suggest Beijing is stashing debt in overseas custodial accounts to avoid transparency and mask the true extent of its U.S. debt exposure.
Why it matters
The move comes amid global fears of de-dollarization as China seeks to diversify its assets. Official U.S. reporting may omit overseas custodial holdings, creating a gap in ownership transparency. This strategy allows China to maintain financial influence while appearing to divest from the dollar.
What is confirmed
- Canada's U.S. Treasury holdings reached $465 billion in August, up from $169 billion five years prior.
- China's reported U.S. Treasury holdings reached an 18-year low in August.
Still unconfirmed
- China is engaging in backdoor bond-buying involving a $600 billion buildup.
What to watch next
- Verification of overseas custodial account ownership in Canada and Belgium
- Official responses from the Chinese Ministry of Finance regarding Treasury holdings
- Updated U.S. Treasury reporting on foreign custodial transparency
confidence 70%Sources used for this update (11)
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- Fortune — China looks like it's dumping Treasury debt but may actually be stashing it in Canada and Belgium
- The Globe and Mail — Canada on track to become a top-three holder of U.S. government debt, surpassing China
- South China Morning Post — China cuts US Treasury holdings to 18-year low in August as American debt fears mount
- Bloomberg.com — China’s Backdoor Bond-Buying Talk Swirls on $600 Billion Buildup
- Bloomberg.com — Foreign Holdings of US Treasuries Rise From Almost One-Year Low
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- cashwalklabs.io — China looks like it's dumping Treasury debt but may actually be stashing it in Canada and Belgium | Global Cashwalk
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