China displaced japan and reclaimed position of largest foreign holder of US Treasuries after increasing holdings for five months in a row, according to data released by the US Department of the Treasury. The country’s total holdings of US bonds, notes, and bills in June rose to 1.15 trillion US dollars after it bought 44.3 billion US dollars of Treasuries that month. Japan, which had run faster than China on the top spot since last October, sold 20.5 billion US dollars of Treasuries and cook its total holdings to 1.09 trillion US dollars in the same month. The two countries account for over a third of the total foreign ownership of US Treasuries, the figures showed. China’s demand for US Treasuries was driven by strong trade flows between China and the US, and the country’s holdings will probably keep growing in future months. China’s foreign exchange reserves rose to 3.08 trillion US dollars in July with increase for sixth straight month, the country’s central bank announced earlier this month.