According to research from several sources, as well as market data, it looks as if China, the largest holder of US government debt, is dumping Treasuries at an alarming rate, in an attempt to support the yuan.
Following the surprise devaluation of the yuan two weeks ago, the People's Bank of China has been selling dollars and buying yuan to support the yuan's exchange rate. Figures suggest that this policy has cost the Chinese central bank $315 billion in foreign-exchange reserves over the last 12 months.
It's estimated that a continuation of this policy to support the yuan will cost China's central bank $40 billion a month for the rest of the year. The...
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