WASHINGTON — Foreign investors cut their holdings of U.S. Treasury debt in June for the first time in more than two years. The decline came at a time of anxiety about whether the United States would raise its borrowing limit.
China, the biggest buyer of U.S. Treasury debt, increased its investment for a third straight month. But Japan, the second-largest buyer, along with Brazil, Russia, Hong Kong, and a group that includes the Bahamas, Bermuda, the Netherlands and the Cayman Islands, cut their investments.
Overall foreign holdings dropped 0.4 percent to $4.5 trillion. It was the first decline since April 2009.
Much of the decline was driven by private investors. Their net purchases of long-term U.S. Treasurys fell a record $18.3 billion in June. Net purchases are the difference between what investors buy and sell in one month.
The decline lowered private investors’ overall foreign holdings by $15.1 billion.
Overall foreign holdings of governments, which include central banks, dropped only $1.7 billion. Governments account for roughly 72 percent of total foreign holdings of U.S. Treasury debt.
