The UK now holds $779.3 billion in US Treasurys, pushing past China’s $759.0 billion and taking second place among foreign holders of American government debt, according to the March update from the US Department of the Treasury’s Major Foreign Holders of Treasury Securities table released on Friday.
While China and Japan relied heavily on trade surpluses and currency strategies, the UK’s rise is tied more to the City of London’s role as a middleman for global capital.
London’s financial institutions handle money from US tech giants, pharma companies, and sovereign wealth funds, and when those clients buy Treasurys, the holdings show up under the UK’s name, even if the money isn’t British.
Still, domestic investors in the UK, including pension funds and banks, have also been buying Treasurys for safety, especially after domestic gilt yields hit 5.65% in 2025.
Japan stays on top by cycling dollars from exports, while China pulls back but still buys when it suits its goals
Japan’s $1.167 trillion Treasury position is built on decades of exporting cars, electronics, and machinery to the US. Those exports pull in huge amounts of dollars, which end up with the Bank of Japan.
The BOJ converts those dollars into Treasurys as a way to manage foreign reserves and keep the yen from rising too much, which helps protect its export economy. As of press time, Japan’s total foreign exchange reserves stand at $1.27 trillion, and a large share of that is in Treasuries.
Private investors are part of the picture, too. Big institutions like the Government Pension Investment Fund and Nippon Life Insurance want stable assets that can match their long-term liabilities. With Japanese bonds offering ultra-low returns, they’ve looked abroad.
Japan’s holdings peaked at $1.316 trillion in 2016, but the country has sold at times to support the yen. In Q3 2024, Japan dumped $61.9 billion to help its currency. Still, they continue to buy regularly, often through US custodians, either in auctions or the secondary market.
China’s Treasury total dropped to $767.4 billion in March, continuing a gradual cutback from its 2013 peak of $1.3167 trillion. Even so, China still plays a major role in the US bond market. Dollars pour into the country because of its trade surplus with the US, driven by cheap goods like electronics, toys, and clothing.
These dollars are converted into yuan through the People’s Bank of China, which then uses the dollars to buy Treasurys. That cycle has helped stabilize China’s exchange rate, which is still loosely managed even after the end of the official peg.
In February 2025, China added $23.5 billion in Treasurys. But that came after a big pullback in Q3 2024, when China sold $51.3 billion. Some of that sale was for reserve management, but it also came during a rough patch in US–China relations. As Cryptopolitan reported, Beijing is moving money into gold, European assets, and even crypto.
UK’s Treasury haul is built on financial muscle, not exports
The UK’s Treasury stash grew from $610.7 billion in January 2022 to $769.2 billion in September 2024, then rose slightly to $779.3 billion by March 2025, according to the Major Foreign Holders of Treasury Securities table.
Much of what’s counted under the UK’s name actually belongs to foreign clients, including major US companies that store cash in the UK to avoid domestic taxes. Those funds are managed by London-based asset managers who move some of that money into Treasurys. When they do, it counts as a UK holding.
But that’s not the full story. British banks, pension funds, and mutual funds are also buying Treasurys themselves. With the UK economy still feeling Brexit’s fallout and domestic bonds offering higher but riskier returns, many investors prefer the security of US debt. Even as 10-year Treasurys hit 4.592% in April 2025, the demand from UK-based buyers remained strong.
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This articles is written by : Nermeen Nabil Khear Abdelmalak
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