The Straits Times reported last night (April 2): "Middle East tensions triggered a global sell-off in bonds. Chinese government bonds have become the world's sole safe haven. Since the outbreak of war in Iran, Chinese government bonds have avoided the global bond sell-off wave and are now serving as a safe haven against soaring energy prices and rising global inflation."
[Clever] Commenting briefly: The Iran situation is merely a superficial pretext for China’s government bonds becoming a global safe haven. Behind this lies the central bank’s precise strategy of continuously reducing its holdings of U.S. Treasuries to a historic low in 2018, combined with ample domestic liquidity supporting the market, and even deeper long-term strategic planning toward de-dollarization. Amid the collapse of U.S. debt credit and a global wave of bond selling, China has strategically positioned renminbi-denominated bonds to absorb global risk-aversion demand—not a random market choice, but an intentional move advancing renminbi internationalization and reshaping the global financial landscape. Yet we can see that each step is carefully timed to break free from dollar hegemony and build an independent financial security shield.
Original source: toutiao.com/article/1861412958407687/
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