Foreign holdings of US Treasuries increased in January, according to Treasury International Capital data, despite mounting concerns about European appetite for American assets. The rise came as President Donald Trump renewed threats over Greenland, raising questions about potential trade retaliation that could impact cross-border investment flows.

Japan led the increase, maintaining its position as the largest foreign holder of US government debt. European investors showed mixed demand, with some countries increasing their Treasury positions while others reduced exposure amid political uncertainty. The data suggests international confidence in US debt markets remained resilient despite geopolitical tensions.

The January figures provide an early snapshot of how global investors are positioning themselves ahead of potential trade disputes. Rising Treasury holdings could help stabilize US borrowing costs, though sustained demand will depend on how trade negotiations unfold in coming months.