Top White House adviser Lawrence Summers on Thursday played down the significance of a decline in China's holdings of U.S. Treasuries.

Some saw China's paring back of its portfolio as a possible sign of protest against U.S. policies.

But asked on CNBC about the move, Lawrence Summers, director of the White House National Economic Council, said the reduction did not signal a concern and that U.S. government debt retains its reputation as a secure investment.

The truth is that these numbers fluctuate and that there's a wide range of holders of Treasury debt, Summers said.

That what's been very clear from the market responses over the last two years is that the United States is seen as a major source of quality and a place people run to when they're uncertain, he added.

In December, China was a net seller of all Treasuries to the tune of more than $34 billion, bringing its total holdings down to $755.4 billion from $789.6 billion in November. As a result, China fell behind Japan to become the second-biggest holder of U.S. Treasuries.

Summers said the government has an obligation to future generations to ensure U.S. Treasuries retain their reputation for quality and that is why it is crucial to rein in surging debt levels.

President Barack Obama earlier named a bipartisan panel to make recommendations for putting the country on a more sustainable fiscal footing.

Summers said it was crucial to address the problem of long-term U.S. entitlement costs.

Asked whether the administration would be open to middle-class tax increases if the panel were to propose them, Summers said that was hypothetical but said the 18-member commission would not have preconditions for its recommendations.

He urged the U.S. Congress to move quickly to pass a broad bill to tighten financial regulations to prevent a repeat of the 2008-2009 market meltdown.

It can't be right in our country that huge institutions aren't even regulated at all with regards to that systemic risk, Summers said. It can't be right that there's no effective oversight of consumer practices in the subprime and other areas that led to this problem.

We're certainly pushing the Senate to act as rapidly as it can, Summers said.

Concerning the state of the economy, Summers there were still severe economic problems but it has improved.

We are on the right path and what we need to do is persevere. It's part of the reason why jobs legislation is such an important priority for the president this year, he said.

(Writing by Caren Bohan; Editing by Patricia Zengerle and Eric Walsh)

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