Foreign Investors Look for Safe Bets in U.S. Securities
Foreign residents increased their holdings of U.S. securities in July, according to the Treasury International Capital report. The U.S. Treasury reports net foreign purchases of U.S. securities and banking inflows by all foreign investors — both private and public — of $194.9 billion for October. Of this, 95 percent were private inflows and 5 percent were from foreign governments.
The financial landscape in the United States has been somewhat dubious in the wake of the 2008 crisis, but foreign investors seem to buy into the bull thesis that many domestic investors hold and appear eager to participate in the U.S. markets. Net purchases by private foreign investors were $59.4 billion in October, although foreign officials logged a net sale of $4.7 billion.
U.S. residents purchased $19.2 billion worth of long-term foreign securities in October, meaning that once again, there was more foreign investment in U.S. longer-term securities than there was U.S. investment in foreign longer-term securities. Net foreign purchases of longer-term securities was $3.4 billion for the month, or $23.9 billion after adjusting for things like unrecorded principal payments.