U.S. Investment Outflow Hits Record
The U.S. posted a record cross-border investment outflow in June as China and Japan reduced their holdings of Treasuries and private investors abroad sold bonds and notes.
“Right at the beginning of June, you had a very strong sell-off of Treasuries and that’s what frightened a lot of private investors,” Gennadiy Goldberg, U.S. strategist at TD Securities USA LLC in New York.
Private investors and government holders combined were net sellers of $20.8 billion in Treasury notes and bonds in June, the biggest monthly net sales in a year, according to the report.
Treasuries declined in June amid improving economic data, and as reports released that month, from unit labor costs to consumer prices, indicated inflation pressures beginning to build within the economy.
Treasuries were bolstered and yields began to decline after Federal Reserve Chair Janet Yellen described the inflation data as “noisy” and stressed the economy’s need for continued accommodation at her June 18 press conference.
Source: Bloomberg
