Threat of global turmoil will boost demand for U.S. bonds
State Street, BlackRock see Treasuries support as China slows
It might be easy to conclude China’s unprecedented retreat from Treasuries is bad news for America.
After all, as the biggest overseas creditor to the U.S., China has
bankrolled hundreds of billions of dollars in deficit spending,
particularly since the financial crisis. And that voracious appetite for
Treasuries in recent years has been key in keeping America’s funding
costs in check, even as the market for U.S. government debt ballooned to
a record $13.2 trillion.
Yet for many debt investors, there’s little reason for alarm.
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