China has cut its holdings in US Treasuries to $805bn, the lowest level since 2009
Beijing has been selling $502bn in Treasuries in the past decade, & pace of Chinese selling has been accelerated recently. Source: Bloomberg, HolgerZ
🌍Worldwide, many other countries have debt that is more than their GDP
Japan consistently ranks among the top nations with a debt-to-GDP ratio exceeding 200%. Source: Genuine Impact
China shows signs of stabilization after a long period of slowdown and disappoitning data over the spring
China’s Q3 growth exceeds forecast, buoyed by consumer spending and industrial production. China posted 4.9% growth in the July to September quarter from a year earlier, stronger than the median forecast for 4.6%. Quarter on quarter, China’s GDP grew 1.3% in the third quarter, helped by a downward revision for Q2 from +0.8% to 0.5%.
Nvidia stock, $NVDA, is now down 7.5% as President Biden restricts AI chip sales to China
The stock has erased nearly $100 billion in value in just over 24 hours. Is it the the beginning of a new trade war with China? Source: The Kobeissi Letter
China | PBOC adds net 289 billion yuan via medium-term facility as Debt Sales Surge
The move adds to recent efforts to ensure hitting GDP target - Offers Most Cash Support Since 2020 - Bloomberg China’s central bank is making the biggest medium-term liquidity injection since 2020, stepping up efforts to support the nation’s economic recovery and debt sales. The People’s Bank of China added a net 289 billion yuan ($39.6 billion) into the financial system via a one-year policy loan on Monday, the most since Dec. 2020. At the same time, it drained a net 134 billion yuan of short-term liquidity through open-market operations.
Visualizing China’s Dominance in Battery Manufacturing (2022-2027P)
by Elements / Visual Capitalist
Is China to blame for the rise in US long rates?
China has cut its holdings in US Treasuries to $822bn, lowest level since 2009. Beijing has been selling $300bn in Treasuries since 2021, & pace of Chinese selling has been faster in recent months, Apollos's Slok has calculated. Source: HolgerZ, Bloomberg
Japanese Yen falling to lowest levels against the U.S. Dollar since the BOJ intervened last year
150 level approaching fast 👀 Meanwhile, The Bank of Japan announced an extra bond-buying plan for this week as a global debt selloff forces policymakers into the market to curb sharp increases in yields. The BOJ will purchase extra amounts of 5-to-10-year debt on Wednesday as it strives to slow rising yields that are at the highest level in a decade. The benchmark 10-year maturity climbed to 0.775% Monday, a level last seen in 2013. Japan’s 20- and 30-year yields are at similar peaks while Treasury yields also keep moving higher. Japanese sovereign yields have risen as speculation grows the central bank will end its negative interest rate sooner rather than later, while the US Federal Reserve will also keep borrowing costs high. The BOJ has already conducted three unscheduled buying operations since late July to manage yields after adjusting policy to let them rise more. Source: Barchart, Bloomberg
