“The reality is that China needs the US more than the other way around,” Carson Group’s Sonu Varghese said.
China has been selling its US Treasurys over the past few months, but it’s not a sign of economic strength and it won’t hurt the US, according to a Tuesday note from Carson Group.
Beijing’s holdings at the end of June hit a 14-year low of $835 billion amid mounting evidence that the post-COVID economic rebound is fizzling.
The country is likely selling its Treasurys to prop up the yuan, which continues to weaken against the US dollar, according to Carson Group.
To help boost exports, China historically kept the currency relatively weaker by buying US bonds, Carson Group’s global macro strategist Sonu Varghese pointed out.
