China passes Japan as largest creditor for US National Debt

November 20th 2008.

China has bought more of the US National Debt and has now surpassed Japan as the largest creditor. China's investment in U.S. Treasury bonds surged to $585 billion in September 2008, surging past Japan's $573.2 billion worth.

The debt purchase by China raises the US dollar while devaluing the Yuan, hurts American manufacturers and creates the potential for US banks to raise interest rates in the future.

See: China buys more US debt, passes Japan for more details.