Holdings rise to five-month high despite trade tensions
China's holdings of U.S. Treasuries grew for a second month in March to .188 trillion, its highest level since October, even as overall foreign purchases of Treasuries fell, data from the U.S. Treasury Department showed.
Overseas investors also grew discontent with Wall Street, reducing their U.S. stock exposure by the largest monthly clip in two-and-a-half years.
The increase in China's U.S. bond ownership may sooth concerns about whether the Chinese government may pare back its Treasuries stockpile in retaliation to the Trump administration, which has sought to slap stiff tariffs and erect barriers against nations it perceives are conducting unfair trade practices.
Japan's holdings of Treasuries, on the other hand, fell in March to .044 trillion, the lowest since October 2011, data showed.
Meanwhile, the amount of Treasuries held in Ireland rose in March to 7 billion after a record .5 billion fall in February, which stoked speculation about whether U.S. multinational companies may be repatriating some money back home in the wake of the massive tax overhaul enacted by Congress in December.
While China's and Ireland's holdings of Treasuries increased, foreigners overall sold U.S. government securities. Their net sales totaled .92 billion in March, compared with .19 billion in February.
Offshore investors unloaded .05 billion in Treasuries in March, their steepest monthly sale since December 2016, while foreign central banks added .39 billion in U.S. government debt on top of the .06 billion they purchased in February, according to the latest Treasury data.
Foreigners, while less keen on Treasuries, scooped up agency securities and corporate bonds in March.
Their net purchases of agencies totaled .28 billion, the most since July 2016, while they bought .39 billion in corporate debt, the highest monthly increase since November.
In contrast, overseas investors sold .15 billion in stocks in March, the biggest monthly outflow since September 2015.