Japan surpassed China in February as the largest foreign holder of U.S. Treasurys for the first time since 2008, according to Treasury International Capital data released on Wednesday.
A rising dollar, along with fatter yields in the Treasury market, compared to an effective zero-rate policy in Japan lured Japanese investors to the Treasury market, said David O’Malley, CEO of Penn Mutual Asset Management.
Japanese holdings of Treasurys TMUBMUSD10Y, +0.18% fell by $14.2 billion to $1.224 trillion since January, while China’s holdings declined by $15.4 billion to $1.223 trillion. On a year-over-year basis, Japan’s holdings increased $13.6 billion, while China’s declined $49.2 billion.
The third biggest holder of U.S. Treasurys in February was a group of countries known as “Caribbean Banking Centers,” which include the Bahamas, Bermuda, Cayman Islands, Netherlands Antilles, and Panama. Their total holdings were $350.6 billion, up from $338.5 billion in January.
Belgium’s holdings, which surprised the market in January by coming in third with a total of $1.24 trillion, fell back to $345.3 billion in February, a figure more in line with the $341.2 billion in holdings from February 2014.
The news comes as the Treasury market wrestles with the Federal Reserve’s plans to raise interest rates, while the European Central Bank and the Bank of Japan are engaged in monetary stimulus.
此新闻发布之际,美国国债市场正忙着应对美国联邦储备理事会(美联储,Fed)计划提高利率,而欧洲央行(ECB)和日本央行(Bank of Japan)正忙于实施货币刺激措施。
As dollar-denominated assets became increasingly attractive for Japanese investors, China rather sought to protect the yuan from declining too much against the dollar.
As Win Thin, the global head of emerging-market strategy at Brown Brothers Harriman & Co. in New York told Bloomberg, with the weakness in the currency and the potential outflows, there’s less need or opportunity for the Chinese to accumulate dollar reserves, especially as the economy slows.
Foreign buying is expected to continue to suppress long-term rates in the U.S., Russ Koesterich, BlackRock’s global chief investment strategist, said in a note. The foreign pressure on U.S. rates was particularly evident in February, as Japanese investors bought their largest amount of Treasuries in seven months.
See That Drill 31 minutes ago
We are awesome
Kevin Tron from Facebook4 hours ago
U.S currency dictates the world!
Jason D Kilsch from Facebook5 hours ago
NOW I see why Japan has become a new player in the US war game ... they US has no choice BUT to enable them to war time power thanks @MarketWatch
louis tan 6 hours ago
Shinzo Abe has to demonstrate his allegiance. U.S. Treasuries is his way of paying homage.
Sean Wieland from Facebook6 hours ago
Adam Briller from Facebook6 hours ago
Foreign?..we dropped a bomb on them..we own Japan
外国吗? . .我们在他们那儿曾投下过一枚炸弹…我们自己的日本
Steven Carver from Facebook6 hours ago
Japan is dumb
Jack Marxon 6 hours ago
"Belgium’s holdings, which surprised the market in January by coming in third with a total of $1.24 trillion, fell back to $345.3 billion in February, a figure more in line with the $341.2 billion in holdings from February 2014." Also, might have been a typo, since Belgium's Jan 2015 holdings are now shown as 354.6, with nothing close to $1 trillion showing on Belgiums' line. http://www.treasury.gov/ticdata/Publish/mfh.txt
A much more interesting question is who is actually behind the Carribean Banking Centers, or do we care? Surely it is not the governments of those small nation-islands. Hedge funds? Drug dealers?
“出人意料的是，比利时所持证券由1月的1.24万亿美元,位列第三，在2月份回落到3453亿美元,这个数字与2014年2月的3412亿美元的资产更相符。” 这也可能是一个错误,因为2015年1月比利时所控股显示为3546亿美元, 根本没有丝毫接近1万亿美元。