It's Not China That's Dumping US Treasuries...

Recent fears, warranted or not about the potential for retaliatory liquidation by China of its US Treasury holdings appear to have been exaggerated because according to the latest TIC data released, the trade-war enemy added $8.5 billion in TSYs in February (the most of any nation and the biggest monthly addition in six months)...

But while China, for now - given the lagged data, is still buying, two other notable nations are selling... significantly.

The second largest foreign US creditor, Japan, that has been liquidating in recent months, and in February, Japan sold $6.3 billion in TSYs (the most of any nation in February), bringing its total to $1,059.5BN, the lowest total since the start of 2012.

And along with Japan, Russia dumped Treasuries for the 3rd straight month to the lowest in a year...

Other notable holders were mixed:

  • The United Kingdom added $7.2BN to $250.5BN
  • Belgium, i.e. the proxy for China and other anonymous buyers, rose by $2.0BN to $125.7BN
  • Cayman Islands, i.e. hedge funds, also added some $10.3BN to $252.2BN (the biggest jump since Dec 2015

All this Treasury buying (and selling) was during the chaotic swings of February's fiasco in short-vol trades: recall TIC data is 2 months delayed. But March will likely be the big tell as that's closer to the beginning of escalating trade war tensions.

Meanwhile, the good news for all these buyers of US debt is that thanks to Trump's budget, there's plenty more where that came from.

Looking at the broader universe of all US International capital transactions, in February, foreign public and private entities bought a total of $43.2BN in Treasurys while also buying $11.8BN in Agencies; they also added a modest $4.1 BN in corporate bonds.

But the biggest surprise - or perhaps not considering what happened in February - is that after buying a near-record $57.9BN in US equities in February, in March, foreigners hit the brakes on further US stock purchases, and actually sold $1.2BN in stocks, the first month of net sales going back to August 2017.

Comments

strannick American Psycho Mon, 04/16/2018 - 17:55 Permalink

Meanwhile, the good news for all these buyers of US debt is that thanks to Trump's budget, there's plenty more where that came from.

-haha. Tho the bad news is once the Exchange Stabilization Fund, and other Dark Pool proxies for the Fed, lose control of this Treasuries malarky market, ..then look out below for the USD and look out above for yields..both of which already are pushing out into uncharted territory.

In reply to by American Psycho

Fiat Burner Mon, 04/16/2018 - 16:30 Permalink

What if people actually stood on principle and refused to lend money to this thieving, war mongering, piece of shit gang of parasites called the "US Government"?

Sell US bonds.

scv Mon, 04/16/2018 - 16:33 Permalink

those still on the train,

America has been taken over by an enemy that worships satanism as its only religion.

there is no left/right political parties
when they are always financed by one telaviv cabal objective.

stormy is just the beginning;
the enemy-mosad assets that blackmail a USA president into war crimes
has dirt, many years many years of blackmail just waiting: wikipedia.org/wiki/Plato%27s_Retreat

this means, moar war,
but bigger this time
very very big

앞으로의 위험, 조심스러운 조일. 그들은 전쟁을 원한다.
前方有危险,小心他们想要战争
опасность впереди, осторожноони хотят войны
خطر پیش رو، مراقب باشیدآنها جنگ می خواهند
خطر في الأمام ، دقيقيريدون الحرب

Triple A scv Mon, 04/16/2018 - 16:36 Permalink

I'm confused, can someone please explain... So the US is issuing about 100 billion dollars of debt per month and China was the biggest buyer at only 8 billion in FEB.... Who is buying the other 90 billion or so in debt? I don't know how rates don't skyrocket. I am sure the fed is still rolling over some of there maturities but I feel that there would have to be more buyers? The bond market confuses me. Not a financial guy but trying to learn.

In reply to by scv

Winston Churchill Mon, 04/16/2018 - 16:40 Permalink

We already know China is using UST's to buy hard assets everywhere and to fund OBOR.

The TIC report is fabricated garbage, if you believe it more fool you, I'd put more faith in a BLS report,they

sometimes print a fact by mistake.

ExPat2018 Mon, 04/16/2018 - 16:46 Permalink

Japan along with S. Korea wants in on the OBOR project

If push comes to shove Japan and Taiwan will align with China

Japan  is sick of the Americunt liars,, and warmongers.

 

ExPat2018 Mon, 04/16/2018 - 17:15 Permalink

Japan gets along with Putin just fine.  Japanese respect intelligent people

There are no more intelligent people in the USA.

Nothing but bullying warmongering trash.

ExPat2018 Mon, 04/16/2018 - 17:15 Permalink

Japan gets along with Putin just fine.  Japanese respect intelligent people

There are no more intelligent people in the USA.

Nothing but bullying warmongering trash.

photonsoflight Mon, 04/16/2018 - 17:30 Permalink

Oh well, another day, another billion in debt. At this point in time does it really matter? Bankrupt is bankrupt. Morally, spiritually, economically, etc. etc. etc.....

 This is like a really bad tv show and we have lost the remote.

mailll Mon, 04/16/2018 - 23:27 Permalink

Yea but it is only updated to February.  Lets see what they did in March and April.  But it doesn't matter, the fed will pick up the slack with free money.  Call it bribery if you will.  We buy your debt, you leave us alone.