Overseas demand for U.S. stocks and bonds fell in March, the government said, as foreign governments turned into net sellers of U.S. Treasuries for the month.
Net inflows into U.S. assets fell to $69.8 billion in March from an upwardly revised $90.5 billion in February. Economists were expecting net inflows to total about $80 billion for March.
The report is used to gauge the appetite for U.S. assets among foreign buyers, whose willingness to finance the trade deficit had until recently kept bond yields relatively low.
The report, which has become closely watched in recent months, showed that foreigners purchased $89.2 billion in U.S. securities last month, down from $102.5 billion in February, while U.S. investors bought $19.4 billion of overseas securities last month, up from $12 billion a month earlier.
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Among foreign governments and official institutions, there was a net $6.3 billion sale of Treasury bonds and notes, offset by a $9.3 billion net purchase by private overseas investors. Private investors bought $15.2 billion of government agency bonds, down from $28.7 billion in February.