Foreign holdings of US Treasuries in July down for 2nd straight month, data shows

Foreign holdings of US Treasuries declined for a second straight month in July, data from theTreasury Department showed on Wednesday, led by declines in holdings from Japan and China.

Holdings of US Treasuries slid to US$9.248 trillion in July from US$9.298 trillion in the previous month. But compared with a year earlier, Treasuries owned by foreigners were up 1.5 percent.

Here are some details:

* Japan holdings fell to US$1.104 trillion in July, down 1.1 percent from US$1.117 trillion in June. Its holdings dropped for a third straight month. It remained, however, the biggest non-US holder of US Treasuries, with holdings hitting a peak of US$1.325 trillion in November 2021.

* The United Kingdom, the second-largest foreign holder of Treasuries, showed a 6.2 percent increase in holdings to US$998.3 billion in July from US$939.9 billion the previous month. The UK is widely viewed as a major custody hub for global investors and its flows are often considered as a proxy for hedge fund positioning.

* China's hoard of Treasuries dropped 2.4 percent to US$618 billion in July from US$633.4 billion in June, falling for second consecutive month. China's holdings in July were the lowest since September 2008, when these tumbled to US$618.2 billion.

* China is still the third-largest non-US holder of Treasuries. Its July holdings have fallen by more than 11 percent on a year-on-year basis.

* On a transaction basis, July saw Treasury outflows of US$3.6 billion, from an inflow of US$6.2 billion in June.

* US corporate bonds posted inflows of US$26.9 billion, down from US$39.4 billion in June.

* US equity inflows dropped sharply in July to US$3.7 billion, from US$181.6 billion in June.

* Overall net capital inflows for July were US$83.7 billion, down from US$135.5 billion the previous month. 

Reuters

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