U.S. Refuses to Return China’s Gold, Beijing Responds by Selling Bonds
According to the Chinese publication , the U.S. is delaying the return of gold, citing legal and financial barriers. However, Beijing views these arguments as unfounded and considers the situation an act of economic pressure.
In response, China has initiated a large-scale reduction of its holdings in U.S. government debt, offloading substantial amounts of Treasury bonds. This move could lead to higher yields on U.S. bonds, increased borrowing costs for the U.S., and instability in global markets.
This step aligns with Beijing’s broader strategy of reducing dependence on the U.S. financial system and increasing the yuan’s influence in international transactions. China has been actively expanding its gold reserves and promoting alternative trade mechanisms, including transactions in national currencies with major economic partners.
The situation further strains already tense relations between the world’s two largest economies. If the U.S. continues to withhold Chinese assets, it may trigger further retaliatory measures from Beijing, including intensified efforts to displace the dollar from international financial operations.
Financial analysts warn that escalating tensions at this level could lead to sharp currency fluctuations, increased inflationary pressure in the U.S., and greater uncertainty in global markets.
The economic standoff between the U.S. and China is gaining momentum, and its consequences could reverberate throughout the global financial system. In the near future, tensions may escalate further, posing new challenges for the world economy.
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