In this report, we are going to answer question 9 “who is buying US treasury bonds and why”. With the development of economic globalization, countries have a deep communication on the import and the export. Generally speaking, US dollar is the main way to trade in this environment. Therefore, to keep a relative stable exchange rate between home currency and US dollar becomes a topic for every country. Buying US treasury bonds is the main way to control the balance between home currency and US dollar. On the other hand, different countries have their own reasons to buy US treasury bonds except this main reason as well. We are going to answer this question from talking about the reasons China, Japan and EU buying US treasury, because they are the first three holders. To answer this question, we found the data from the website called “US department of the treasury”. The first data is a table showed “Foreign holdings of U.S. securities, by country and type of security, for the major investing countries into the U.S., as of June 30, 2011”. In this table, China, Japan and EU are the three main economic entities hold more U.S treasury bonds than others. In 2011, China and Japan were the first two countries held 1,727 billions of dollars and 1,585 billions of dollars respectively. European countries followed them after. While the UK held 982 billions of dollars, Luxembourg, Switzerland, Belgium and Ireland held 817,488,443, and 405 billions of dollars.

The second table is called “Major foreign holders of treasury securities”. It has the data from September 2014 to September 2015, the order didn’t change much. While China, Japan and European countries always held the most US treasury bonds, Brazil and Middle East increased the mount they held. As mentioned in this table, China and Japan hold more than 1000 billions of dollars all the time. The main European