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Tuesday, February 7, 2023

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The 2 Largest Foreign Holders Dumped US Treasuries In October, Record Annual Equity Outflows

The latest Treasury International Capital flows data (for October) shows, total overseas holdings of US Treasuries (by majors) tumbled once again (by $111.5 billion) to $7.185 trillion in October – the lowest level since May 2021…

However, on an aggregate long-term basis (including private and official entities), Treasuries were bought… Here is the breakdown.

  • Long-term TSY +61.907BN vs +60.430BN

  • Agencies +24.247BN vs 28.268BN

  • Corporate Bonds +1.895BN vs +5.523BN

  • Corporate Stocks -24.369BN vs 0.829BN

But, the UST buying was mostly private as official entities saw $23.87bn in selling

Japan was the biggest seller of TSYs in October, followed by Ireland, UK, and China.Canada was the biggest buyer of USTs in October followed by France and Hong Kong.

Japan, the largest foreign owner of US Treasuries, saw its holdings decline by $42 billion in October, to $1.078 trillion. That’s the lowest level since April 2019

Source: Bloomberg

China’s stockpile – the largest behind Japan’s – fell by $24 billion, to $909.6 billion, the lowest since June 2010

Source: Bloomberg

There has also been 10 straight months of foreign buying of US corporate bonds…

Finally, we note that foreign outflows from US stocks on a LTM basis reached a new record $285.9 billion in October after 10 straight months of selling…

Source: Bloomberg

That’s a lot of selling!

This post was originally published on this site

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