Net long-term inflows into U.S. assets rose to $86.9 billion in February, up from a revised $69.2 billion a month earlier, the Treasury Department said. The gain reflects sizable purchases by private investors of U.S. corporate and agency bonds.
The inflow reading has become an increasingly sensitive number in U.S. markets as traders look for signs that foreign investors are losing their taste for U.S. assets. A major tempering of overseas demand would be viewed as a negative by U.S. markets, where foreign buying is generally credited with holding down long-term interest rates.
Among private investors, foreigners bought $28.7 billion of government agency bonds in February, up from $19.4 billion in January. They added $28.2 billion of corporate bonds, up from $23.5 billion. Among government buyers, foreigners bought $15.7 billion of U.S. Treasuries in February, down from $22.3 billion.
By region, Japanese investors owned $673 billion of Treasury securities in February, more than any other country and up from $669 billion in January. OPEC countries had $84.9 billion of Treasuries in February, compared with $78 billion in January, while China had $265.2 billion, up from $262.1 billion.
Ownership of Treasuries in Caribbean banking centers, where many hedge funds are located, fell to $94.1 billion from $105.1 billion.