Foreign governments and private investors are continuing to slash their holdings of United States debt, which may not bode well for the federal government and the national economy as the country is suffering from the shackles of astronomical debt level and a weak economy.
Last month, China and Japan, two of the biggest holders of U.S. Treasurys, reduced their holdings by $2.5 billion and $600 million, respectively, according to a new report released Friday. Private investors also sold off a record amount of bonds and notes in June.
Both nations have diminished their holdings over the past decade from 50.9 percent in 2004 to 41.4 percent this year. China currently maintains $1.27 trillion, while Japan has about $1.22 trillion on the books.
Other countries, meanwhile, continued to increase their holdings of U.S. debt last month. Belgium, which is the third-largest holder of U.S. debt, ramped up its holdings by $1.7 billion to $364.1 billion in the month of June. Brazil, Taiwan, Switzerland, Hong Kong, Luxembourg, Russia and Ireland all purchased more U.S. Treasurys.
Overall, though, governments and private investors were combined net sellers of about $20.8 billion in Treasury notes and bonds.
Investors in Treasurys lost about one-tenth of a percent last month, while the Bloomberg U.S. Dollar Index lost 0.7 percent.
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