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Did China and the United States reach an agreement? Yellen sent someone to convey that China increased its holdings of US debt by 15.2 billion and the United States lifted a ban. Why did China choose to increase its holdings of US debt? What did the people sent by Yellen discuss with China? What impact will the lifting of the ban on China by the United States bring?

According to the International Capital Mobility Report released by the U.S. Treasury Department on August 15, China increased its holdings of U.S. Treasuries by 11.9 billion in June. This is the second time China has increased its holdings of U.S. Treasuries in the past eight months. The last time was in April, but it only increased its holdings by 3.3 billion yuan. That is to say, in the first half of this year, China has increased its holdings of U.S. Treasuries by a total of 15.2 billion U.S. dollars. After this increase, China's holdings of U.S. Treasuries have once again reached the 780 billion U.S. dollar mark, reaching the highest level since January this year.

So why did China choose to increase its holdings of U.S. debt when the U.S. debt crisis could break out at any time? There are at least two reasons for this move. First, buying government bonds is an investment, and investment is of course for the purpose of making money. China's increase in holdings of U.S. debt at this time can be said to be a brilliant move.

From May to June this year, the exchange rate of the Japanese yen against the US dollar experienced abnormal fluctuations, soaring from 147 yen to 1 dollar at the beginning of May to 160 yen to 1 dollar at the end of June. In order to stabilize the exchange rate, Japan sold US Treasury bonds for two consecutive months, including 22 billion in May and 10.6 billion in June. This move also caused fluctuations in the US Treasury market. China's behavior can be regarded as "bottom fishing".

This can be fully reflected in the data. On May 10 this year, the price of 10-year US Treasury bonds was $111.77. On June 2, the price of the same type of US Treasury bonds fell to $108.94. After China increased its holdings, US Treasury bonds suddenly ushered in a wave of price increases. By August, the price of 10-year US Treasury bonds had reached around $114. It can be said that China completely hit the cusp of the US Treasury market surge.

Moreover, due to the surge in the gold market, China has also suspended its momentum of increasing its gold holdings. In other words, China's increase in U.S. debt holdings is largely based on economic considerations.

On the other hand, although China has been reducing its holdings of U.S. Treasuries and increasing its holdings of gold, it is still the second largest holder of U.S. Treasuries after Japan. If U.S. Treasuries really collapse, it will be more trouble than it is worth for China. Therefore, China's increase in holdings of U.S. Treasuries can not only gain actual benefits, but also send goodwill to the United States. Why not do this kind of business that is sure to make money?

So on the day when the U.S. Treasury Department released the U.S. debt data, the China-U.S. Financial Working Group held its fifth bilateral meeting in Shanghai. Yellen's assistant, U.S. Treasury Assistant Secretary Neyman, led a group of people including Deputy Treasury Secretary Liang Neili.American FinanceExperts attended the meeting. At present, the official has not announced the details of the meeting, but according toThe New York TimesAccording to the report, the main content of the meeting was to hope that China and the United States could strengthen communication in economic and trade and maintain bilateral economic relations. It seems that the United States understands China's subtext. It is not good for anyone to break up. Strengthening cooperation and fair competition should be the mainstream of the relationship between the two countries.

Just before Naiman came to China, the US military also expressed its attitude of easing relations with China. On August 12, the US Department of Defense decided to remove Hesai Technology, a Chinese lidar manufacturer, from the "blacklist". Since last year, Hesai Technology has been accused of having links with the Chinese military. In January this year, Hesai Technology was included in the list of "military-related enterprises" and was sanctioned by the United States. In May this year, Hesai Technology filed a complaint with the Pentagon, saying that the judgment of the US Department of Defense was "arbitrary and willful."

After months of legal proceedings and public opinion fermentation, the Pentagon finally decided to lift the ban. According to the Financial Times, the reason for the US decision was that US government lawyers were worried that the decision would not withstand legal review.

This decision caused an uproar in the United States, especially strong opposition from Republican lawmakers, who believed that LiDAR is the foundation of future technology and the United States should not allow Chinese companies to dominate this key field.

Representative John Mullenauer of Michigan bluntly criticized the Department of Defense's decision on social media, saying it would expose the United States' critical infrastructure to Chinese surveillance risks. Senators Marco Rubio and Rick Scott also expressed their views, demanding that Hesai Technology be put back on the "blacklist" and calling on the government to strengthen restrictions on Chinese technology companies.