China's ambassador to the U.S. wouldn't rule out a cut in Chinese purchases of U.S. Treasury bonds in response to tariffs imposed by President Donald Trump, Bloomberg reported.
Ambassador Cui Tiankai told Bloomberg TV that China is "looking at all options" when asked if the country would consider reducing purchases of U.S. Treasurys.
China is currently the biggest creditor of the U.S., holding $1.17 trillion in Treasurys as of January, equivalent to 19% of all foreign holdings of U.S. government securities.
Such a move would come as the U.S. faces a widening of its budget deficits in the coming years.
"Any unilateral and protectionist move would hurt everybody, including the United States itself," Cui said. "It would certainly hurt the daily life of American middle-class people, and the American companies, and the financial markets."
Trump on March 22 ordered tariffs of up to $60 billion on U.S. imports from China to counter "unfair" trade practices and forced transfer of intellectual property of American companies. China on March 23 responded with plans to impose levies on $3 billion of U.S. imports.