Chris J posted today about a renewed interest in buying T bonds. I wondered who was doing the buying. Then, I found this article on marketwatch today.
“Foreign central banks were net sellers of U.S. long-term financial assets in May for the first time in more than a year, the Treasury Department reported Tuesday.
Despite the $1.4 billion in net sales by official foreign buyers, net capital flows into the United States rose to $69.6 billion in May from $51.1 billion in April, as private investors scooped up large amounts of Treasury bonds and government agency bonds.
The United States requires large capital inflows each month to help fund its current account deficit. ” END QUOTE
It appears the increased buying is coming from US investors. My guess: with rates so high, investors are comfortable holding cash. Others sold their homes or stocks, and are back in safety of cash.
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