CHINA’S holdings of U.S. Treasuries fell to the lowest level since July as investors soured on U.S. fixed-income securities and the dollar at the start of the year.

China’s portfolio of U.S. bonds, notes and bills sank to US$1.17 trillion in January from US$1.18 trillion a month earlier, according to U.S. Treasury Department data released Friday.

China remains the largest foreign creditor to the United States, followed by Japan, whose holdings rose for the first month since July to US$1.07 trillion from US$1.06 trillion.

Overall, foreign ownership of Treasuries receded in January for a third straight month, falling to US$6.26 trillion, after reaching a record-high US$6.32 trillion in October.

The U.S. bond market, the world’s biggest, endured its worst January since 2009 amid investor fears that inflation could force the Federal Reserve to more aggressively hike rates.

Chinese investment in the United States has been getting more attention than usual since U.S. President Donald Trump took office and pressed ahead with his protectionist agenda.

He has also threatened a host of trade penalties against Chinese goods.

(SD-Agencies)