China throws US debt! On gold hunting instead of dollar!
China throws US debt! On gold hunting instead of dollar!
The global financial policy landscape is currently feeling the waves of an important event: China, a keyland of the BRICS group, has repelled over $ 21 billion in US state bonds since the beginning of 2024. It is the greatest sale of China ever, in particular at $ 53.3 billion, which were sold in the first quarter of 2024 alone. This movement sends shock waves through the financial markets and attracts the attention of global investors.
The background of this financial upheaval lies in the long-term strategy of redarization, led by China and other Brics nations. These have consistently reduced US assets since 2022. The decline in the possession of US debt papers signals the endeavor of the BRICS countries to detach itself on the dependency on the US dollar. In the course of the increasing inflation and the dominance of the dollar worldwide, more and more countries are considering the BRICS group as an attractive alternative.
strategic swivel: gold as a safe harbor
In the middle of these efforts to reduce US dollars, China continues to pursue the strategy of massively increasing its gold reserves. Together with the BRICS partners, China has been one of the largest gold buyers worldwide since 2022. Last year alone, China added several tons of gold to his reserve worth $ 550 billion. This step supports the speculation that the planned new Brics currency could possibly be covered by gold.Stephen Chiu, Chief Asia Foreign-Exchange and Councils Strategist at Bloomberg Intelligence, emphasizes that China's sale of US securities could accelerate. This is particularly likely if the trade dispute between the United States and China is once again laid down, which could be driven by political changes in the USA, in particular a possible choice of Donald Trump in November.
This development leads to growing uncertainty with regard to the future of US financial dominance. With a state debt of over $ 35.6 trillion in 2024, the United States faces challenges that further increase the attractiveness of other, aspiring economic blocks such as the BRICS. More details on this topic can be found in a detailed report on Watcher.Guru .
The financial and economic change that the BRICS group is striving could have long-term effects on the global balance of power. By reducing the dollar ownership and the strategic expansion of the gold reserves at the same time, China sets a clear sign of a new economic era in which alternative currencies and financial structures are more well received.
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