Tags: Foreign | Governments | US Debt | Treasury Bonds

CNN Money: Foreign Governments Dump US Debt at Record Clip

Image: CNN Money: Foreign Governments Dump US Debt at Record Clip

By    |   Friday, 18 Mar 2016 04:26 AM


Cash-strapped foreign central banks and government institutions sold $57.2 billion of U.S. Treasury debt and other notes in January, the highest monthly tally on record going back to 1978 and up from $48 billion in December, CNN Money reported.

It's part of a broader trend that gathered steam last year when central banks sold a record $225 billion of U.S. debt, CNN Money reported.

"Foreigners have no longer been our BFF when it comes to buying U.S. Treasurys," Peter Boockvar, chief market analyst at The Lindsey Group, wrote in a client note.

Foreign central bankers are mostly using the funds to stimulate their own economies as the global growth slowdown and crash in oil prices continue to take their toll.

"These foreign sales are not fundamentally driven. The U.S. economy seems to be on better footing," Sharon Stark, fixed income strategist at D.A. Davidson, told CNN Money.

Foreign holdings of U.S. Treasury securities rose in January to the highest level in a year even though the biggest foreign owner, China, cut back slightly, the AP reported.

The Treasury Department says total foreign holdings increased 0.7 percent to $6.18 trillion, the highest level since they were at $6.22 trillion in January 2015. China trimmed its holdings 0.7 percent to $1.24 trillion while Japan, the second largest foreign owner of Treasury debt, boosted its holdings 0.1 percent to $1.12 trillion.

In addition to Japan's small increase, other countries increasing their holdings were Switzerland, the United Kingdom, Belgium, Taiwan and India.

The national debt now stands at a record $19.1 trillion. With the federal budget deficit projected to grow, the United States will need to see continued strong foreign demand for Treasury debt.

(Newsmax wire services contributed to this report).

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Cash-strapped foreign central banks and government institutions sold $57.2 billion of U.S. Treasury debt and other notes in January, the highest monthly tally on record going back to 1978 and up from $48 billion in December, CNN Money reported.
Foreign, Governments, US Debt, Treasury Bonds
287
2016-26-18
Friday, 18 Mar 2016 04:26 AM
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