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🇨🇳China might be beginning to back away from U.S. debt as investors get nervous about overexposure to American assets
As of February 10, 2026, reports indicate that Chinese regulators have officially advised the nation's major financial institutions to curb their exposure to U.S. Treasury securities. This directive, issued by the People's Bank of China (PBOC) and the National Financial Regulatory Administration, specifically urges banks to limit new purchases and pare down existing high-exposure positions.
While the guidance currently excludes official state reserves, it signals a strategic shift as China's total holdings have already dropped to $682.6 billion—the lowest level since 2008.
Key Drivers for the Pullback
Regulators and analysts cite several factors for this pivot toward diversification:
Market Volatility & Concentration Risk: Authorities cited concerns over sharp swings in the U.S. bond market and the risks of being overexposed to a single asset class.
Geopolitical Tensions: Ongoing friction under the second Trump administration, including threats of 60% tariffs and debates over U.S. institutional independence, has eroded the "safe-haven" perception of U.S. debt.
Rotation to Alternative Assets: China has increased its gold reserves for 14 consecutive months, with holdings reaching a value of approximately $369.58 billion by January 2026. $BTC
