Foreign buying of U.S. bonds more talk than reality

The advantage of higher yields in the United States has not prompted foreign buying as investors had expected, and central banks have instead dumped Treasuries in recent months. Foreign central banks reduced their holdings of U.S. Treasuries last week to $2.900 trillion, the lowest in a year, according to the U.S. Federal Reserve. Thursday will bring new weekly data on this figure, and signals point to flows continuing toward Europe in both equity and fixed-income. The shift in money out of U.S. assets is unexpected, given that the dollar recently hit a 12-year high and U.S. yields are much higher than Europe's. Analysts believe overseas central banks have spent dollar reserves to defend currency pegs or to stem further depreciation against the greenback.

via Business News http://ift.tt/1BquafU