Global Economics and Trade Policy by Brad Setser
Brad Setser is a Senior Fellow at the Council on Foreign Relations, known for his granular analysis of global capital movements and sovereign reserves. With a background at the U.S. Treasury and National Economic Council, Setser publishes the blog Follow the Money, which is regularly cited by Bloomberg, The Financial Times, and IMF working papers.
In August 2025, Setser published a breakdown of China’s hidden USD treasury holdings, revealing a true exposure of USD 1.1 trillion, a figure that contextualized Bitcoin’s role in circumventing capital controls. His research is followed by thousands of crypto macro traders who rely on sovereign behavior models to predict stablecoin flows and reserve diversification.
Setser does not advocate for crypto, but his empirical frameworks provide critical context for understanding its emergence within global balance sheet strategies.
Brad Setser: Taiwan central bank and insurance rules may constitute manipulation
Brad Setser questions whether the actions of Taiwan's central bank and its non-prudential insurance regulations, particularly those that discourage hedging, could be considered a form of ...
China could be designated in next FX report, Brad Setser notes
Brad Setser discusses the implications of the Treasury retaining its current thresholds for assessing the 2015 trade enforcement act. According to Setser, if the Treasury uses FX settlement rather ...
Brad Setser: China import gains mainly replaced other imports for ICE vehicles
Brad Setser addresses the argument relayed by Martin Sandbu of the Financial Times, originally put forward by Gavekal, that higher imports from China often simply replaced imports from other ...
Pakistan needs reserves but swap use may be limited, Brad Setser notes
Brad Setser questions whether Pakistan would face restrictions if it tries to use a U.S. currency swap to pay its various Chinese state creditors. He highlights that while Pakistan needs to ...
Brad Setser: Financial flows structure central to China-Europe trade debate
Brad Setser highlights that the ongoing debate involves not just trade, but also the current structure of financial flows. He notes there is a significant overlap between Chinese and European ...
Current Treasury market stability weighed by deficits and demand, Brad Setser writes
Brad Setser provides a summary of the Treasury market’s current state, focusing on ongoing debates about the market’s stability. Setser points to concerns regarding persistent deficits, ...
Brad Setser: Weak yen helps Toyota compete with Chinese automakers globally
Brad Setser highlights that shifts in exchange rates continue to be important for global markets. He observes that the weak Japanese yen is allowing Toyota to better withstand competition from ...
China central bank monthly reserves increase by $15 billion, Brad Setser notes
Brad Setser reports that China's central bank and state commercial banks have released balance sheet data for June. He notes that there were no surprises this month, with the People's Bank of ...
Brad Setser: Apple profit reclassification moves profit to goods line without affecting current account balance
Brad Setser discusses the effect of moving Apple's profit from China over to the goods line in official economic data. He notes that while this adjustment, which aligns with IMF standards, shifts ...
Japan does not face an external debt issue, Brad Setser argues
Brad Setser challenges the notion that Japan faces an external debt problem. He points out that the country's net interest payments are low among G-7 economies, with any projected rise starting ...
Brad Setser: U.S. primary fiscal deficit exceeds Japan’s in 2025
Brad Setser highlights that the Japanese yen is declining in value against the dollar, despite the U.S. not being a model of fiscal discipline. He points out that the primary fiscal deficit of ...
Trade deficit moves to Taiwan and Southeast Asia, Brad Setser notes
Brad Setser highlights that the trade deficit has shifted toward Taiwan, Thailand, Vietnam, and Mexico. He points out that these countries are not displayed on the referenced chart but are now ...
Brad Setser: Taxes paid by U.S. multinationals in Ireland could fund a major navy
Brad Setser points out that the taxes U.S. multinationals such as Apple, Microsoft, Lilly, and Pfizer pay in Ireland, instead of the U.S., are so substantial they could fund a large military ...
European leaders see trade ties with China as unsustainable, Brad Setser notes
Brad Setser points out that European leaders are clear in describing the trading relationship with China as unsustainable. He notes that changes in the real, volume-based trade balance have been ...
Brad Setser: German auto exports to China drop sharply, exposing economic risks
Brad Setser highlights that Germany's auto exports to China accounted for about 0.6 percentage points of German GDP. Losing more than half of this market in a short period represents a significant ...
Financial repression underpins Chinese economic system, Brad Setser notes
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 ...
Brad Setser: China state financial system foreign assets near $6 trillion
Brad Setser highlights that BIS data indicates a $2.5 trillion net foreign asset position for China's banking system, with most of it held in foreign exchange. When combining this with reported ...
China betting on export-driven growth without matching imports, Brad Setser warns
Brad Setser questions whether China's strategy of prioritizing export growth over import expansion will prove wise. He observes that China is relying on net exports to contribute around 1.5 ...
Brad Setser: Private foreign investors drive strong U.S. equity inflows in April
Brad Setser highlights that most analysts focus on the Treasury table in the monthly TIC data, but the key development in the April data was strong equity inflows. Setser notes that most of the ...
China reduces U.S. Treasuries held by custodians to 18-year low, Brad Setser notes
Brad Setser points out that China has decreased its holdings of Treasuries in U.S. custodians to an 18-year low. He clarifies that the headline should specifically reference Treasuries held in ...
Brad Setser: G7 participants differ on effectiveness of Plaza deal from 87 to 90
Brad Setser points out that many participants in the G7 group do not believe the Plaza deal was effective. However, he highlights that there was a very symmetric decline in the U.S. deficit and ...
