Foreign Investors' US Treasury Holdings Increase at Fastest Rate in 6 Months

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kwon Jaehee] Amid rising U.S. Treasury yields this year, foreign investors' holdings of U.S. Treasuries saw the largest increase in six months in January.

According to major foreign media citing U.S. Treasury data on the 15th (local time), foreign investors' holdings of U.S. Treasuries in January amounted to $7.119 trillion (approximately 8,062 trillion KRW), an increase of $49 billion (0.7%) from the previous month. This represents the strongest buying momentum since July last year.

By country, Japan's holdings increased from $1.251 trillion in December last year to $1.276 trillion in January this year, while China’s holdings also rose from $1.072 trillion to $1.095 trillion during the same period.

Jannadi Goldberg, a strategist at investment bank TD Securities, analyzed that "the rise in interest rates has increased the investment appeal of U.S. Treasuries."

The yield on the U.S. 10-year Treasury note rose from 0.917% at the beginning of the year to 1.094% at the end of January, driven by economic recovery expectations due to COVID-19 vaccine distribution and inflation concerns. Recently, it even climbed to 1.63%.

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