Friday, 14 Jun 2013 10:16 AM
Foreign investors dumped U.S. government debt in April and were net sellers of all long-dated U.S. securities for the third consecutive month, the U.S. Treasury said on Friday.
Selling was heavily concentrated in Treasury bonds and notes, with overseas investors unloading $54.5 billion, the first net outflow in seven months. Private investors alone sold $30.8 billion - the largest one-month outflow on record.
Overall, foreigners sold $37.3 billion in long-term U.S. securities, the largest outflow in at least three years. March's outflow was revised slightly to $13.4 billion.
"Demand for U.S. securities was much weaker in April," said Gennadiy Goldberg, U.S. strategist at TD Securities. He said the scope of Treasury sales was "somewhat surprising given the fresh bout of European uncertainty observed in the month," referring to a European Union rescue of Cypriot banks.
Official investors, including central banks, were also net Treasury sellers in April. China, the largest foreign U.S. creditor, slashed its holdings by $5.4 billion to $1.265 trillion. Japan sold $14 billion, leaving its total holdings at $1.114 trillion.
However, foreigners bought $23 billion of debt issued or guaranteed by the biggest U.S. mortgage financing agencies, including Fannie Mae and Freddie Mac.
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