Brief: The Largest Foreign Holders of U.S. Treasuries

Mobius Intel Brief:

The Treasury’s $39 billion 10Y auction showed stronger-than-expected headline results today, with a high yield of 4.435% stopping through the 4.465% When-Issued yield by 3 basis points—the second largest stop-through on record.

Key Intel

• Foreign/international buyers showed record participation, with indirects jumping to 87.9% of total accepted bids from 67.4% in March.

• Conversely, direct participation sank equally as sharply from 19.5% in March to 1.4% — the third-lowest share on record.

• Paired with President Trump’s 90-day pause on higher reciprocal tariffs (excluding China), record international participation in today’s 10Y auction offers an alternative perspective to prevailing fears that U.S. trade measures would lead to a rapid selloff of foreign-held Treasuries.

• While the risks to U.S. borrowing costs from total foreign-held debt are real, fears that large, potentially adversarial holders of U.S. Treasuries (such as China) could fuel a cataclysmic rise in U.S. interest rates require additional context.

• Context: Foreign holdings of U.S. Treasuries in January 2025 reached $8.53 trillion (+7% Y/Y), accounting for ~29.8% of the U.S.’ $28.6 trillion in total marketable public debt in 1Q25. While China’s $760 billion in U.S. Treasuries ranks as the the second-largest for a single nation, this sum represents just 2.66% of the U.S. total marketable public debt.

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