Japan surpassed China in June as the largest foreign holder of U.S. government securities.

Japan has added about $ 21 billion to its portfolio of U.S. debt securities since May this year, raising its total assets to its highest level since October 2016.

Japan now has $ 1.12 billion in U.S. government securities and $ 1.11 billion in China, according to the US Treasury Department.

China is no longer an aggressive buyer of US sovereign debt, and market players speculate that one of the actions Beijing could take in a trade war with Washington could be the sale of US sovereign bonds.

However, stock market traders say there are no signs of this happening. The United Kingdom is the third largest holder of US debt at $ 342.3 billion in June, up from $ 323.1 billion a month earlier.