Source: Zero Hedge
Gradually we are getting confirmation that Chinese "posturing" about
offloading US debt is all too real. The most recent TIC data confirmed
the Treasury's greatest nightmare: China is now dumping US bonds. In
December China sold $34.2 billion of debt ($38.8 billion in Bills sold
offset by $4.6 billion in Bonds purchased), lowering its total holdings
$755.4 billion, the lowest since February 2009,
and for the first time in many years relinquishing the top US debt holder spot to Japan,
which bought $11.5 billion (mostly in Bonds, selling $1.4 billion
Bills) bringing its total to $768.8 billion. Also, very oddly, the
surge in UK holding continues, providing yet another clue as to the
identity if the "direct bidder" - as we first assumed, these are merely
UK centers transacting primarily on behalf of China as well as hedge
funds, which are accumulating US debt under the radar. UK holdings
increased from $230.7 billion to $302.5 billion in December:
a stunning $70 billion increase in a two month span. Yet, with the identity of the UK-based buyers a secret, it really could be anyone... Anyone with very deep pockets.
TREASURY INTERNATIONAL CAPITAL DATA FOR DECEMBER
WASHINGTON – The U.S. Department of the Treasury today released Treasury
International Capital (TIC) data for December 2009. The next release,
which will report on data for January 2010, is scheduled for March 15,
2010.
Net foreign purchases of long-term securities were $63.3 billion.
- Net foreign purchases of long-term U.S. securities were $82.2 billion. Of this, net purchases by private foreign investors were $62.6
billion, and net purchases by foreign official institutions were $19.6
billion.
- U.S. residents purchased a net $18.9 billion of long-term foreign securities.
Net foreign acquisition of long-term securities, taking into account adjustments, is estimated to have been $50.9 billion.
Foreign holdings of dollar-denominated short-term U.S. securities, including Treasury bills, and other custody liabilities
decreased $67.7 billion. Foreign holdings of Treasury bills decreased
$53.0 billion.
Banks' own net dollar-denominated liabilities to foreign residents increased $77.7 billion.
Monthly net TIC flows were $60.9 billion. Of this, net foreign private flows were $82.0 billion,
and net foreign official flows were negative $21.1 billion.