Foreign holdings of US Treasuries fell in June from the previous month, led by declines in the stockpiles owned by Japan and China.
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.
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.
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’s yen has been under pressure in recent months, spurring interventions by Tokyo to shore it up.
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 — pushing US borrowing costs higher.
“The Japan move clearly was due to FX intervention,” 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 — via repurchases. “Needless to say, we will not see a repeat of Japanese selling of Treasuries,” Upadhyaya said.
The second-biggest decline in overseas Treasuries holdings in June was in China’s stockpile, which dropped by $25.9 billion to $633.4 billion.
This article was generated from an automated news agency feed without modifications to text.
