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By Gertrude Chavez-Dreyfuss
NEW YORK, March 15 Foreigners sold U.S.
Treasuries for a 10th straight month in January, data from the
U.S. Treasury department showed on Wednesday, a trend that has
been in place since the Federal Reserve started flagging
interest rate hikes last year.
U.S. Treasuries showed outflows of $6.97 billion.
Foreign official institutions, which include central banks,
were the biggest sellers of Treasuries, unloading $44.86 billion
in U.S. government bonds, led by Germany, China, and emerging
market central banks in Taiwan and India. That offset purchases
by private investors for the month totaling $38.08 billion.
Gennadiy Goldberg, interest rates strategist at TD
Securities in New York, said China continued to sell Treasuries
in January, as it dipped into its reserves to prop a falling
"Net-net, Treasury flows were neutral to slightly positive,"
said Goldberg, noting that foreign participation in U.S.
Treasury debt auctions over the last few weeks has picked up
with the run-up in yields.
Yields on U.S. benchmark 10-year Treasury notes at the
beginning of December were 2.45 percent, hitting a
high of 2.56 percent and ending the month at 2.45 percent. On
Wednesday, U.S. 10-year yields fell to 2.49 percent, a one-week
low, as the Federal Reserve signaled that further rate increases
would be gradual in pace.
The rise in Treasury yields and the selloff in bonds have
also coincided with the election of Donald Trump in November,
which suggested more pro-growth policies such as increased
infrastructure spending that could lead to more inflation.
The data also showed that China reduced its U.S. Treasury
holdings by $7.3 billion to $1.051 trillion in January, making
it the second-largest holder of U.S. government debt. China has
sold Treasuries in seven of the last eight months.
For a fourth consecutive month, Japan was the biggest
non-U.S. holder of U.S. Treasuries, with $1.102 trillion
The data also showed offshore investors bought $6.3 billion
in long-term U.S. assets in January, after selling $12.9 billion
the previous month. Including shorter-dated securities,
foreigners bought $110.4 billion in U.S. assets in January,
after selling $65.3 billion in December.
Foreign inflows into U.S. stocks, meanwhile, totaled $15.1
billion in January, after outflows of $10 billion the previous
(Reporting by Gertrude Chavez-Dreyfuss; Editing by Sandra Maler
and Grant McCool)