Chinese and American leaders at the G20 in Buenos Aires last year. Photo: Saul Loeb/AFP/Getty Images

While some had suggested China could cut its purchases of U.S. Treasury bonds as a way to retaliate or escalate its trade war with the U.S., Fang Xinghai, the vice chairman of the China Securities Regulatory Commission, said such a move is unlikely.

Reality check: It was always a low probability event, as it would endanger China's economy as much or more than the U.S.

What they're saying: Fang told a World Economic Forum panel in Davos, Switzerland, that he doesn’t think his country "will in any way significantly reduce its investment into the U.S. government bond market."

  • China is America’s largest foreign creditor, holding more than $1.1 trillion of Treasuries.
  • Market participants have told Axios in recent weeks that strong U.S. Treasury note auctions could be due to China making a sizable return to the market, as direct bidders — a group made up of foreign buyers and U.S. institutions that don't do business directly with the Federal Reserve — have taken home particularly large slices of recent bond deals.

Worth noting: We don't know for certain whether the Chinese have been buying more Treasuries. The CFTC, which tracks international Treasury buying, has been closed due to the government shutdown, with the last report in December showing October's data.

Go deeper: The market rally that could signal a coming recession

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Illustration: Aïda Amer/Axios

  1. Politics: Pence chief of staff Marc Short tests positive for coronavirus — COVID-19 looms over White House Halloween celebrations.
  2. Health: Fauci says maybe we should mandate masks if people don't wear them — America was sick well before it ever got COVID-19.
  3. World: Polish President Andrzej Duda tests positive for COVID-19.
What Matters 2020

The missed opportunities for 2020 and beyond

Photo illustration: Sarah Grillo/Axios. Photos: Jason Armond (Los Angeles Times), Noam Galai, Jabin Botsford (The Washington Post), Alex Wong/Getty Images

As the 2020 presidential campaign draws to a close, President Trump and Joe Biden have focused little on some of the most sweeping trends that will outlive the fights of the moment.

Why it matters: Both have engaged on some issues, like climate change and China, on their own terms, and Biden has addressed themes like economic inequality that work to his advantage. But others have gone largely unmentioned — a missed opportunity to address big shifts that are changing the country.

Pence chief of staff Marc Short tests positive for coronavirus

Marc Short with Katie Miller, Vice President Pence's communications director, in March. Photo: Doug Mills/The New York Times via Reuters

Marc Short, Vice President Mike Pence’s chief of staff, tested positive for the coronavirus Saturday and is quarantining, according to a White House statement.

Why it matters: Short is Pence's closest aide, and was one of the most powerful forces on the White House coronavirus task force.