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China Raises U.S. Debt Holdings as Others Offload

Increased its holdings by 1.7% to nearly $884 billion

China, the top creditor of the U.S., increased its stockpile of American debt in September, official figures showed on Nov. 16, even as other nations slashed their holdings.

Both China and Japan bucked the trend of foreign investors cutting their exposure of U.S. assets.

Overall holdings -- known as net long-term capital inflows in financial jargon -- fell 37% from elevated levels in August.

Amid political sensitivities over the level of U.S. bonds held by Beijing, the emerging market giant -- excluding Hong Kong -- increased its holdings by 1.7% to nearly $884 billion.

Japan meanwhile raised its Treasury holdings to $865 billion, a more than 3% increase.

"The strong interest in Treasury bonds and notes points to a still-high level of risk aversion in global financial markets," said Tu Packard of Moody's Analytics.

Copyright Agence France-Presse, 2010

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