Category:
Foreign Investors This category includes articles about the flow of investment from one country to another, either as portfolio investment, short-term instruments, or direct long-term investment.
Q1 2006
By John Schroy, on June 28th, 2006 |

Although foreign investors continue to be the largest purchasers of most types of US bonds, this sector showed less interest in treasuries than in the past, shifting assets into short-term repurchase agreements in Q1 2006. If the Federal Reserve continues to push short-term interest rates upwards and if foreign investors continue to move into short-term fixed investments, such as repurchase agreements, long-term interest rates may be forced higher.
Q1 2006
By John Schroy, on June 20th, 2006 |

In Q1 2006, the excess of US imports over exports continued to provide dollars to the rest of the world, which were invested in the US bond market.
Although foreign central banks reduced flows into US treasuries and agencies after the high point of 2004, the shortfall has been more than covered by flows into bonds from foreign private sources. The driving force behind foreign purchases of US bonds is not so much related to interest rates as to worldwide neo-mercantilist impulses to favor exporters.
US Trade Deficit 2005
By John Schroy, on March 15th, 2006 |

Foreign funds created by the record US trade deficit of $726.9 billion in 2005 were channeled mainly into the US bond market. This went a long way towards keeping bond prices up, despite massive net corporate bond issues connected with asset-backed securities (mostly mortgage related) that also set impressive records: $462.9 billion.
Foreign investors purchased (net) $214.1 billion in US Treasury securities and $351.1 billion in corporate bonds.
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