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Foreign holdings of US debt increase

Published:Tuesday | June 17, 2014 | 12:00 AM

Foreign buyers of US Treasury securities increased their holdings in April to another record high even though China cut back on its holdings for a third straight month.

The US Treasury Department reported Monday that total foreign holdings rose 0.2 per cent to a record US$5.96 trillion, up from US$5.95 trillion in March. It marked the ninth consecutive monthly increase.

China, the largest foreign buyer of US Treasuries, reduced its holdings for a third month, cutting them by 0.7 per cent to US$1.26 trillion. Japan, the second largest buyer, boosted its holdings by 0.8 per cent to US$1.21 trillion.

Foreign demand for US Treasury debt is expected to remain strong this year, helped by more borrowing certainty given the congressional agreement to suspend the debt limit until March 2015.

The monthly Treasury report showed that holdings by Belgium dropped 3.9 per cent to US$366.4 billion while holdings in the Caribbean banking centres including the Bahamas, Bermuda and the Cayman Islands, fell 1.3 per cent to US$308.4 billion.

Russia, which had been trimming its holdings of US Treasury debt for five straight months, increased them in April to US$116.4 billion, up 15.9 per cent from March but still below the recent high of US$149.9 billion last October.

- AP