BRICS turn away from US Treasury bonds: New reduction of $17 billion!

The desire of the BRICS countries to put an end to their dependence on the dollar is becoming more and more operational. Several countries in this recently expanded organization of states are distancing themselves from American Treasury bonds which they are actively selling off.

The rejection of US Treasuries is not an isolated case

China and Saudi Arabia were thought to be the only BRICS countries distancing themselves from US Treasuries. In fact, this has nothing to do with an isolated trend since several other countries in the organization seem to be joining the movement.

This is the case of Brazil. Indeed, the latest data from the US Treasury Department reveal that the country reduced its holdings of Treasury securities by $2.7 billion during the month of July.

Over this period, Brazil’s assets in US Treasury securities increased from $227.4 billion to $224.7 billion. India has also joined Brazil in this dynamic.

Sources show that over the same period in July, India’s holdings of Treasury securities declined by $2.3 billion. They went from $235.4 billion in June to $233.1 billion in July.

In one month, BRICS reduce their holdings of US Treasury bonds by 17 billion

The rejection of US Treasuries undertaken by the BRICS could become widespread

Looking at its trends, at least three of the founding members of BRICS appear to be actively divesting themselves of US Treasuries. But interestingly, the trend is similar for the United Arab Emirates (UAE).

This Gulf country, recently integrated into the organization as part of BRICS+, also reduced its investments in US Treasury bonds by $300 million. This, by increasing them from 65.2 billion dollars in June to 64.9 billion dollars in July.

We can clearly see that an aggressive policy of rejecting US Treasury bonds is emerging. A dynamic which could also accelerate as the bond market experiences turbulence linked to a rapid rise in Treasury yields.

Obviously, for now, US Treasuries are of some use to countries that hold them. This, for a simple reason. They constitute one of the safest investments in the world because they are issued by a stable government and have a relatively high repayment capacity.

For now, this trend towards the rejection of US Treasury bonds could have a symbolic nature. A way to show their determination to put an end to the hegemony of the United States via their currency whose trends interest the crypto market.

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