Latest statistics released by the U.S. Department of the Treasury show that China purchased US$21.7 billion worth of US treasury bonds in August, bringing its total debt holdings to US$868.4 billion.

This marks the largest monthly net increase of Chinese holdings of US bonds. Observers believe that China's move was driven by the desire to avoid investment risks against the backdrop of the weakened recovery of the US and European economies and a depressed financial market.

According to these statistics, Japan and Britain hiked their bond holdings by US$15.6 billion and US$74.1 billion, bringing their holdings to US$836.6 billion and US$448.4 billion, respectively.

China currently remains the No.1 holder of U.S. Treasury bonds, with Japan and Britain being the second and the third largest holders. Of the top ten holders of U.S. treasuries, only China's Taiwan and Russia reduced their holdings, by US$300 million and US$1.9 billion, respectively.

China's business press carried the story above on Tuesday. China.org.cn has not checked the stories and does not vouch for their accuracy.