Foreign ownership of US debt rises; China reclaims top spot
By CHRISTOPHER S. RUGABER
AP Economics Writer
WASHINGTON (AP) -- Foreign holdings of U.S. debt rose in March
as China ramped up its purchases and displaced Japan as the leading
owner of U.S. Treasury securities.
The
Treasury Department says overseas ownership of U.S. debt rose 2.1
percent in March to $6.18 trillion. That is below January's record of
$6.22 trillion.
China added $37.3 billion of
Treasury debt, bringing its stockpile to $1.26 trillion. That's ahead of
Japan, which added just $2.5 billion, lifting its total to $1.23
trillion.
In February, Japan became the
leading owner of U.S. debt for the first time since August 2008. China
overtook Japan that year as the Great Recession, higher government
spending and a steep drop in tax revenue pushed up U.S. government
borrowing.
The U.S. deficit topped $1 trillion from 2009 through 2012.
Foreign
governments, primarily through their central banks, account for
two-thirds of the foreign holdings. In March, the total held by foreign
governments rose 1 percent from the previous month to $4.13 trillion.
A
group of oil exporting nations, which includes Saudi Arabia, Iraq,
Algeria, Venezuela and Nigeria, added $500 million to bring their
holdings to $297.3 billion, the third largest. Caribbean banking
centers, a group that includes the Bahamas and the Cayman Islands, added
$10.9 billion, lifting their holdings to $293 billion, the fourth
largest.
Demand for U.S. Treasurys, widely
considered one of the world's safest investments, is likely to remain
strong. While U.S. interest rates are still low, they may climb later
this year if the Federal Reserve begins to raise interest rates.
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