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Brad Setser highlights the significance of financial repression, both external and internal, in shaping the Chinese economic model.
According to Setser, this aspect is a core component of how the system operates, suggesting it plays a key role in maintaining the structure of China's economy.
Earlier, Setser noted that China's holdings of Treasuries with U.S. custodians have dropped to an 18-year low, although some offshore assets are not captured by official data. He has also cited BIS data showing China’s state financial system approaching $6 trillion in net foreign assets. These trends mark ongoing shifts in China’s financial positioning globally.