U.S. Treasuries show foreign inflows in February for 4th month

U.S. greenback banknotes are displayed on this illustration taken, February 14, 2022. REUTERS/Dado Ruvic

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NEW YORK, April 15 (Reuters) – Internet international inflows into Treasuries rose for a fourth straight month in February within the quantity of $75.3 billion, information from the U.S. Treasury division confirmed on Friday.

Of that, personal abroad traders purchased $91.9 billion in Treasuries and international official establishments offered $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.

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Total, Treasury Worldwide Capital (TIC) information confirmed a web influx of $162.6 billion, versus a $287.4 billion influx in January. Of this, web international personal inflows had been $198.4 billion, and web international official flows had been damaging $35.8 billion.

The general international shopping for got here as U.S. yields rose. U.S. benchmark 10-year Treasury yields peaked at 2.0650% in February, reaching the very best stage 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 notice 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 climbing rates of interest to sluggish value rises and stave off hotter inflation.

The Fed did elevate its coverage charge in March by 0.25 foundation factors, the primary hike since 2018, and introduced how it will scale back its $8.5 trillion stability sheet, ballooned by pandemic-era bond purchases. A number of extra charge 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 most important 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.

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Reporting by Alden Bentley; Modifying by David Gregorio and Lisa Shumaker

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