National bonds are bonds with a national nature issued by the state as a unit, and the simple point is to borrow money in the form of bonds. It's just that the range of holders of government bonds is much wider. China was once the largest holder of U.S. bonds. But in recent years, the amount of US debt in China's hands has been decreasing, and now it has fallen below the 800 billion mark. This amount is gradually decreasing for China's previous holdings.
From a development perspective, China's economic growth has accelerated, and its global economic position has been steadily improved. Therefore, we need to seek a more stable investment environment and cooperation methods to achieve diversified economic development and reduce dependence on the US economy. So when we have enough capacity to go sideways, the sell-off in US bonds becomes the main manifestation of progress. Previously, the U.S. Treasury Secretary hoped that China would continue to support U.S. bonds and help the U.S. survive domestic inflation, but from the perspective of long-term development and the structure of China's economy, it is no longer suitable to continue to build U.S. bonds, so we did not support U.S. U.S. bonds as we did in 2008. Instead, I chose **.
At the same time, the relationship between the United States and China is also the focus of everyone's attention, and in 2023, although China and the United States have been in frequent contacts, they have not achieved substantial results, and various economic frictions, sanctions, and technological competition have all affected the relationship between the two countries. Therefore, our economic transformation is also imminent. At the same time, the volatility of the U.S. bond itself is relatively large, and it is also affected by the entire international situation, so from the current economic environment, it is not a good investment direction. That's why we're starting in large numbers.
For the current U.S. economy, when everyone is facing problems such as low income, unemployment, and inflation, life is not very ideal. But with the Fed stopping raising interest rates, the inflation problem in the US seems to have eased. And now the interest rate on U.S. bonds is relatively good. Therefore, it has also become another option for the people of their country to continue to add value.
The Fed's interest rate cuts will begin in 2024, so many people want to take advantage of the current interest rate advantage to increase the value of their assets. Therefore, after China sold most of its U.S. bonds, 70% of its U.S. bonds have been repurchased, and the Federal Reserve itself is also buying back a large number of U.S. bonds, which can stabilize the position of U.S. bonds in the international market on the one hand, and on the other hand, it is also necessary to lay a good foundation for future interest rate cuts.