Foreign holdings of US Treasury debt hits record

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Associated Press

Posted on May 15, 2014 at 8:34 AM

Updated Thursday, May 15 at 10:07 AM

WASHINGTON (AP) — Foreign buyers of U.S. Treasury securities increased their holdings in March to a record high.

The Treasury Department said Thursday that total foreign holdings rose 1 percent to $5.95 trillion from $5.89 trillion in February.

China, the largest foreign buyer of Treasury debt, reduced its holdings by less than 0.01 percent to $1.27 trillion. Japan, the second-largest buyer, cut its holdings 0.8 percent to $1.2 trillion.

Belgium, Luxembourg, Switzerland, major oil exporting nations and Caribbean countries involved in banking all increased their holdings. Meanwhile, Russia shed almost 21 percent of its holdings in March following international tensions over its move to annex part of Ukraine.

Russia controls $100.4 billion worth of U.S. Treasury securities, or just 1.7 percent of all foreign holdings. The United States and Russia have imposed sanctions on each other after parts of the Crimean Peninsula with ethnic and political ties to Russia began an attempt to secede from Ukraine in late February.

Foreign demand for U.S. Treasury securities is expected to remain strong this year, aided by more borrowing certainty with a congressional agreement to suspend the debt limit until March 2015.

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