EXPERTS WARN: U.S.DEBT TO CHINA “DANGEROUSLY OUT OF CONTROL!”

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Photographer: Nelson Ching/Bloomberg

China’s pace of foreign-exchange reserve accumulation will be slower this year due to… Read More

China’s holdings of U.S. Treasuries increased $12.2 billion to a record $1.317 trillion in November, data released on the Treasury Department’s website showed.

The figures, scheduled for release at 9 a.m. tomorrow in Washington, were inadvertently posted on the Treasury’s website. Japan’s holdings rose $12 billion to $1.186 trillion, the figures showed.

China’s swelling foreign-exchange reserves, reported today to have reached a world record $3.82 trillion at the end of December, may sustain the nation’s appetite for U.S. debt. Capital inflows and intervention to limit gains in the yuan have contributed to China building up currency holdings that are a third of the global total.

“Large interest-rate differential and steady appreciation of the renminbi contributed to large arbitrage inflows into China, a situation made all the more easy with China’s increasing financial integration and renminbi internationalization,” UBS AG Hong Kong-based economist Wang Tao wrote in a report on China’s data.

China’s pace of foreign-exchange reserve accumulation will be slower this year due to the Federal Reserve’s monetary tapering, likely widening of the yuan’s trading band and tighter controls on arbitrage activities, Wang said.

Early Release

A Treasury spokeswoman said that because of an error, limited amounts of data were posted on the department’s website ahead of the official release, and were removed as soon as it was discovered. The full November 2013 data will be released as previously scheduled at 9 a.m. tomorrow, she said.

See full story @ bloomberg.com

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To contact the reporter on this story: Ian Katz in Washington at ikatz2@bloomberg.net

To contact the editor responsible for this story: Chris Wellisz at cwellisz@bloomberg.net

CLARK KENT @ americasfreedomfighters 
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