Billionaire Ray Dalio warned that the U.S. Treasury market is vulnerable to reduced demand from Japan and others, which he said could be a potential pain point for a market that has already seen sharp swings this year. According to Sina Finance, the Bridgewater founder said in a media interview in Singapore on Tuesday that about one-third of U.S. debt financing relies on foreign capital, much of it from Japan and China.

Dalio said the U.S. is approaching the limit of its debt cycle and warned again that the country could face a debt crisis within three years. He also said global government bond selling, including U.S. Treasuries, has pushed borrowing costs to multi-year highs, while inflation, fiscal spending, and resilient economic growth have left demand for fixed-income securities weak. U.S. Treasury prices extended their months-long decline this week, with the 10-year yield around 5.3%, near its highest level since 2002.