US Treasury Secretary Scott Bessent has dismissed as "media hysteria” concerns that the UK and EU could dump US Treasuries in retaliation for the proposed takeover of Greenland.
“The media has latched on to this. I think it is a completely false narrative. It defies any logic,” he said when asked about the speculation by The National at the USA House in Davos, where he is attending the World Economic Forum Annual Meeting.
“If you look, the US Treasury market was the best-performing market in the world, or the best G7-performing bond market, and we had the best performance since 2020. It is the most liquid market. It is the basis for all financial transactions and I am sure that the European governments will continue holding it.”
The central banks of France, Germany and the UK hold as much as $1.35 trillion of US Treasuries between them. The “nuclear option” would see Europe and the UK sell off US Treasuries in retaliation for any move by the Trump administration to take over Greenland. Such a move could result in higher borrowing costs, market volatility and a weaker dollar, but Mr Bessent said the threat of a sell-off has no basis in reality. “There is no talk in European governments,” he added.
Mr Bessent said Washington was not worried about any retaliatory financial measures over Greenland, pointing to the US Treasury market's strong performance and liquidity.
"If they [the EU and UK] sell Treasuries, then they would have to buy [Chinese] RMBs and it would strengthen their currency. And they've been doing just the opposite," he said, implying that such a move would not be in Europe's best interests. “I think everyone needs to take a deep breath."
His comments came a day before US President Donald Trump’s visit to Davos and against the backdrop of rising tensions among European allies over the future of Greenland.
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US President Donald Trump holds up the signed founding charter at the Board of Peace meeting. EPA -
Ukrainian President Volodymyr Zelenskyy addresses the WEF gathering at Davos. EPA -
Elon Musk on stage at Davos. Bloomberg -
Israel's President Isaac Herzog in discussion at the World Economic Forum's 56th annual meeting in Davos, Switzerland. Bloomberg -
Swiss President Guy Parmelin, centre, welcomes Saudi Minister of Commerce Majid Al Qassabi, centre left, at the opening of the World Trade Organisation's informal ministerial gathering in Davos. EPA -
Gavin Newsom, the Governor of California, speaking at the WEF annual meeting. Bloomberg -
German Chancellor Friedrich Merz speaks during a plenary session in the congress hall. EPA -
Changpeng Zhao, co-founder of Binance Holdings, in Davos. Bloomberg -
US special envoy Steve Witkoff at the WEF annual meeting. Reuters -
US President Donald Trump delivers his address. AFP -
Mr Trump walks from the Marine One helicopter as he arrives in Davos. EPA -
Egyptian President Abdel Fattah El Sisi at a panel discussion. EPA -
Nato Secretary General Mark Rutte at the WEF annual meeting. AFP -
Argentina's President Javier Milei, left, with Switzerland's Federal President Guy Parmelin before a bilateral meeting on the sidelines of WEF. EPA -
Ken Griffin, founder and chief executive of multinational hedge fund Citadel, speaking at Davos. AFP -
European Central Bank President Christine Lagarde in conversation. AFP -
The UAE delegation arrives at the World Economic Forum annual meeting. AFP -
French computer scientist Yann Le Cun and French President Emmanuel Macron at the Business France event in Davos. AFP -
Qatari Prime Minister Mohammed bin Abdul Rahman Al Thani is in attendance. Reuters -
Canadian Prime Minister Mark Carney. Bloomberg -
American businessman Jared Kushner, left, and Steve Witkoff, the US Special Envoy to the Middle East, walk the corridors. EPA -
Apple chief executive Tim Cook. EPA -
Kristalina Georgieva, managing director of the International Monetary Fund, during a TV interview. Bloomberg -
US Treasury Secretary Scott Bessent addresses the media. EPA
At the weekend, Mr Trump threatened the EU and UK with higher tariffs if they refused to accede to his demands to “take” Greenland. Notably, many world leaders this year chose to stay away from WEF meeting, including the Danish delegation.
