(May 19): Foreign holdings of US Treasuries dropped in March from a record high as overseas investors dumped bills while adding to their stockpile of longer-dated federal securities.
Overseas holdings fell by US$138.4 billion in March from the month before, US Treasury data showed on Monday. Holdings figures incorporate both net sales and purchases and changes in valuation.
Much of that overall decline was due to valuations. A Bloomberg index of US Treasuries tumbled 1.7% in March — the worst monthly decline since 2024 — as worries that the Iran war would stoke inflation drove investors to dump bonds. The Treasury’s data showed foreign investors logged a US$142.1 billion valuation loss on their long-term Treasuries holdings for March.
Looking at net transactions, foreign investors sold US$16.8 billion worth of bills, which mature in up to a year, while adding US$13.5 billion of long-term Treasuries, the data showed.
Japan, which has the largest foreign holdings, saw a US$47.7 billion decrease in its stockpile, to US$1.19 trillion. The UK, which has the second-largest, rose US$29.7 billion, to US$926.9 billion.
China, the No 3 holder, saw a decline of about US$41 billion, to US$652.3 billion — the lowest level since 2008.
See also: US industrial production rises by most in over a year
Central banks accounted for the lion’s share of the overall drop, with foreign official accounts sliding by US$108.7 billion, to US$3.9 trillion.
Uploaded by Isabelle Francis
