U.S. Treasuries show foreign inflows in February for 4th month
NEW YORK (Reuters) – Internet overseas inflows into Treasuries rose for a fourth straight month in February within the quantity of $75.3 billion, knowledge from the U.S. Treasury division confirmed on Friday.
Of that, personal abroad traders purchased $91.9 billion in Treasuries and overseas official establishments bought $16.2 billion.
Foreigners have purchased Treasuries in 10 of the final 12 months, together with a file web month-to-month buy of $118 billion in March 2021.
General, Treasury Worldwide Capital (TIC) knowledge confirmed a web influx of $162.6 billion, versus a $287.4 billion influx in January. Of this, web overseas personal inflows had been $198.4 billion, and web overseas official flows had been destructive $35.8 billion.
The general overseas shopping for got here as U.S. yields rose. U.S. benchmark 10-year Treasury yields peaked at 2.0650% in February, reaching the best degree since July 2019, and ended the month at 1.8216%, up about 4 foundation factors from the top of January.
The yield on the two-year word rose to 1.4363% in February from 1.1846% on the finish of January, reaching a peak of 1.6430% that was final seen in December 2019, as markets anticipated that the Federal Reserve would imminently begin mountain climbing rates of interest to gradual value rises and stave off hotter inflation.
The Fed did elevate its coverage fee in March by 0.25 foundation factors, the primary hike since 2018, and introduced how it could scale back its $8.5 trillion steadiness sheet, ballooned by pandemic-era bond purchases. A number of extra fee hikes are anticipated this yr and subsequent.
Overseas holdings of Treasury securities rose to $7.714 trillion from $7.661 trillion in January.
Japan’s holdings of Treasury securities rose by greater than $3 billion to $1.306 trillion. Japan remained the biggest non-U.S. holder of Treasuries.
China, the second-largest holder of Treasuries, noticed its holdings decline to $1.054 trillion from $1.060 trillion in January.
(Reporting by Alden Bentley; Enhancing by David Gregorio and Lisa Shumaker)
