Foreign holdings of US Treasury securities rose in May, with Canada, whose holdings can be volatile, posting the largest increase, while Japan's holdings declined.
Data released by the US Treasury on Tuesday showed overseas investors increased their holdings of US government debt by $18.5 billion in May compared to April, bringing the total to $9.37 trillion, the second-highest level on record.
These figures account for both net sales and purchases as well as valuation changes. The Bloomberg US Treasury Index rose 0.1% in May, following a slight dip the previous month.
Japan, the largest foreign holder of US Treasuries, reduced its holdings by $66.8 billion to $1.14 trillion. Earlier this year, Japanese authorities intervened in foreign exchange markets, selling dollars and buying yen; analysts believe such transactions likely involved the sale of a significant amount of US Treasuries.
Canada's holdings surged by $38.7 billion in May to $435.8 billion.
The United Kingdom, the second-largest foreign holder, increased its holdings by $11.1 billion to $948.6 billion.
Holdings in China, the third-largest holder, rose by $8.2 billion to $659.3 billion. Belgium's holdings also increased during the month; market analysts note that Belgium's holdings include Chinese custodial accounts.
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