Foreign holdings of US Treasuries fell in June from the previous month, led by declines in the stockpiles owned by Japan and China.\u00a0<\/p>\n
Overseas holdings dropped by $72.1 billion from May, according to data published by the Treasury Department on Monday. The total now stands at $9.3 trillion after declines in three of the past four months, from a record high in February.\u00a0<\/p>\n
US government bonds have posted losses over that period, amid investor angst about large budget deficits and above-target inflation. The foreign holdings data incorporate changes in valuation as well as net sales and purchases.<\/p>\n
Japan, which has the largest stockpile, posted the biggest decline in June, with its holdings down by about $26.4 billion to $1.12 trillion. Japan\u2019s yen has been under pressure in recent months, spurring interventions by Tokyo to shore it up.<\/p>\n
In late July, Washington joined in, with Treasury Secretary Scott Bessent announcing a rare coordinated intervention. Behind the decision, according to some market-watchers, lay concern that Japan might otherwise sell its Treasuries to defend the yen \u2014 pushing US borrowing costs higher.<\/p>\n
\u201cThe Japan move clearly was due to FX intervention,\u201d said Paresh Upadhyaya, a strategist at Pioneer Investments. He noted that Bessent not only joined in intervening in July, but also flagged the potential for Japan to use a Federal Reserve facility where it could avoid selling Treasuries outright \u2014 via repurchases. \u201cNeedless to say, we will not see a repeat of Japanese selling of Treasuries,\u201d Upadhyaya said.<\/p>\n
The second-biggest decline in overseas Treasuries holdings in June was in China\u2019s stockpile, which dropped by $25.9 billion to $633.4 billion.<\/p>\n
This article was generated from an automated news agency feed without modifications to text.<\/p>\n
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