Hello, since its issuance, the U.S. government has faithfully and strictly fulfilled its promise to pay interest on a monthly basis and repay the principal at maturity, and this kind of bond has a very high credit all over the world. In the investment field, it is a product with high yield, which is the most stable and reliable, and can be resold to each other (other products, such as stocks and funds, are quite risky, and the interest on bank deposits is too low, which is in danger of bank failure).

What's the use of holding US Treasury bonds?

1 In order to stabilize the exchange rate and protect exports.

China has strong manufacturing capacity and insufficient consumption, so it can only be sold abroad, and the United States is the largest recipient. The massive imports from the United States not only solved the employment problem in China, but also caused the soaring dollar assets in China. The country hopes to stabilize the exchange rate of its currency against the US dollar so that the RMB will not appreciate, thus protecting the country's export industry.

2 for the investment and preservation of US dollar assets.

In the process of doing business with the United States, China has been in a position of trade surplus for a long time and accumulated a large amount of foreign exchange. These dollar assets also need to be preserved through investment, and one way is to buy US Treasury bonds. Due to the good credit of US Treasury bonds, holding a large amount of US Treasury bonds can preserve and even appreciate China's foreign exchange reserves.

Risk disclosure: This information does not constitute any investment advice. Investors should not substitute such information for their independent judgment, or make decisions only based on such information. It does not constitute any trading operation and does not guarantee any income. If you operate by yourself, please pay attention to position control and risk control.