China Masks Up to $500 Billion in Treasury Holdings as Official Total Falls to $591 Billion
Updated
Updated · Fortune · Oct 18
China Masks Up to $500 Billion in Treasury Holdings as Official Total Falls to $591 Billion
3 articles · Updated · Fortune · Oct 18
Summary
$591 billion in August official U.S. data put China’s Treasury holdings at an 18-year low, down from $700 billion a year earlier and $1 trillion in April 2022.
U.S. custody data may understate the real total because securities parked in overseas accounts are often attributed to the custodian country rather than the underlying owner.
Canada’s Treasury holdings jumped to $465 billion from $169 billion in five years, while Belgium’s rose to $490.5 billion from $228 billion, reinforcing suspicions that Chinese assets were rerouted through foreign custodians.
Brad Setser estimates adding Canada and key European custody centers could lift China-linked holdings by as much as $500 billion, with total U.S. financial assets still making up 50% to 55% of China’s reserves.
China’s reserve shift reflects sanctions and trade-war pressures, but its record $1.2 trillion 2025 trade surplus and $938 billion surplus in the first nine months of 2026 still leave vast export earnings to recycle.