The Iran-U.S. conflict continues, with the United States and Japan's government bonds being dumped en masse, and Chinese assets becoming a "safe haven"!

According to the Daily Economic News, since the U.S.-Israel military strikes against Iran on February 28, almost all asset classes including global stocks, gold, U.S. Treasuries, and Japanese bonds have experienced significant declines and sell-offs.

Data from the Federal Reserve shows that since one week before the outbreak of the U.S.-Israel-Iran conflict, foreign official institutions have been net sellers of U.S. Treasuries for five consecutive weeks, with a total sell-off of $90.9 billion. As an indicator of foreign official demand, the custody holdings of U.S. Treasuries have fallen to their lowest level since 2012.

When traditional safe-haven assets like U.S. Treasuries lose their safe-haven function, global investors are turning their focus to China. Over the past month, not only have Chinese government bond yields remained stable, but the renminbi has also appreciated against the trend.

Meanwhile, the renminbi’s role in international payments has also significantly increased. In March, the daily transaction volume of the Cross-Border Interbank Payment System (CIPS) reached 920.5 billion yuan, the highest in the past 12 months, and on April 2, the daily transaction volume further rose to 1.22 trillion yuan.

Standard Chartered Bank revealed to reporters that a portion of Middle Eastern funds have already flowed into the Chinese market in the short term. Renminbi assets are becoming a new “safe haven” amid this Middle Eastern crisis.