Major global investors pull back from US markets:$40 trillion debt pile sparks concern, investors buy gold and increase investments in China

The United States has more than $40 trillion in debt. At the same time, interest rates, tariffs and economic sanctions imposed on other countries are also increasing. As a result, some investors around the world are now considering where to invest their money besides the United States. Some major government funds are reducing their investments in US bonds. Central banks in several countries are increasing their reserves by buying gold. Meanwhile, German companies reduced their investments in the United States and increased their investments in China in the first half. However, this does not mean that the world is turning completely away from the United States. The dollar is still the world’s largest reserve currency, and large amounts of money remain invested in US stocks and bonds. The US is having to pay higher interest to borrow money Investors’ concerns are now becoming clearly visible in the US bond market. The yield on 10-year US Treasury bonds reached around 5% in September. It was 4.93% on 11 September, after having previously risen as high as 4.979%. In simple terms, a rise in yields means the US has to pay investors higher interest to borrow money. In other words, borrowing is becoming more expensive for the government. This could also affect government spending in the long run. To maintain investors’ interest in bonds, the US Treasury is increasing its purchases of older bonds. However, Treasury Secretary Scott Bessent says that the US financial system is strong and recent bond auctions have been successful. Norway may reduce investment in US bonds Norway’s sovereign wealth fund is among those reducing their investments in the US. The fund, worth around $2.3 trillion (₹218.5 lakh crore), is planning to reduce the amount of money it has invested in US government bonds. There is a proposal to reduce the share of government bonds in Norway’s fund from 70% to 50%. The biggest cut is expected to be in US bonds. This could reduce Norway’s investment in US bonds by around $80 billion. However, Norway is not making this change solely to distance itself from the United States. It is also considering investing in Japanese government bonds and other types of bonds. The aim is to diversify its investments and seek opportunities for better returns. German companies’ investment in the United States falls 65%, rises by one-third in China There has been a major difference in the investment figures of German companies in the United States and China this year. In the first half of 2026, their investment in the United States fell 65% to €4.3 billion. Meanwhile, investment in China rose by around one-third to €5.6 billion. According to a study by the German Economic Institute, investment by German companies in the United States has declined at a time when businesses face continued uncertainty over Trump’s tariff and trade policies. Meanwhile, German companies already operating in China continue to invest in their businesses. Dollar’s share gradually declining The dollar is still the world’s most widely used reserve currency. However, central banks around the world are gradually reducing the dollar’s share of their foreign exchange reserves. According to the IMF, the dollar accounted for 56.77% of the world’s foreign exchange reserves in the final quarter of 2025. It stood at 56.93% in the previous quarter. Meanwhile, China’s currency, the renminbi, accounted for just 1.95%. This does not mean that China’s currency is about to replace the dollar. The dollar’s dominance remains very strong. Some countries are simply diversifying where they hold their money. Alongside the dollar, they are also increasing their reserves of other currencies and gold. Central banks continue to buy gold Alongside the dollar, gold is also becoming an important reserve asset for central banks. Several countries are increasing gold’s share in their foreign exchange reserves. According to the World Gold Council, the world’s central banks bought a total of 863 tonnes of gold in 2025. This was lower than in 2024, but still significantly higher than the long-term average. Between 2022 and 2025, central banks bought an average of around 1,000 tonnes of gold each year. This means the trend of adding gold to reserves has continued steadily over the past few years. Purchases continue in 2026 Gold demand also rises in China and India Rising demand for gold is not limited to central banks. Ordinary investors are also investing more money in gold. China’s investment demand for gold rose by 28% in 2025. India’s investment demand for gold also increased by 17%. Together, the markets of the two countries accounted for more than half of the world’s total demand for gold bars and coins. In other words, demand for gold is rising from two directions. On the one hand, central banks are increasing the share of gold in their foreign exchange reserves, while on the other, ordinary investors in major markets such as China and India are also viewing gold as an investment option. America’s economic strength remains intact Despite these changes, America’s economic strength has not yet faded. The dollar still accounts for more than 56% of the world’s foreign exchange reserves. Money from other countries is also invested in the US stock market and government bonds. US Treasury Secretary Scott Bessent says that people’s confidence in the American financial system remains intact and that auctions of government bonds are also proceeding well.