Foreign central banks boosted their purchases of U.S. Treasury and agency bonds in the latest week, assuaging concerns about the possibility that overseas demand would wane, Federal Reserve data showed on Thursday. [1]
That was outstanding. Notice that the author byline for this week’s Reuters report [1] has migrated to the top of the article, and the author is waxing lyrical about the optimistic tale of the numbers. Indeed, at a robust $10.794 rise in total obligations held by foreign central banks, almost equally split between buys of treasuries and agencies, support for the new US administration’s spending plans could be on the horizon. The report was, as usual, based on the weekly update from the NY Fed’s H.4.1 table site.[2] Here is Doom’s updated CSV version of the agencies and treasuries foreign central bank holdings data set.[3]
This week’s result suggests stability. That’s treasuries up $5.344 billion in the above bar graph, and agencies up a near-matching $5.450 billion in the below graph.
Both ends of the raw-numbers graph are heading up strongly, at least for this week.
The balanced buy causes the ratio graph (for the last year) to pause again this week. Could the downward plunge in twist’s graphs be coming to an end?
Clearly the recent divergence documented by Setser’s 52-week change graphs is beginning to moderate. This is no bad thing.
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Notes and References
[1]: "Foreign central banks ramp up U.S. debt holdings", by Pedro Nicolaci da Costa, Reuters, February 12, 2009.
[2]: "H.4.1 Factors Affecting Reserve Balances", Federal Reserve Statistical Release (weekly), Federal Reserve Bank of New York.
[3]: The updated data set as a Comma Separated Value (CSV) file is here.
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