TIC Data: No Significant Surprises

The May TIC report was largely in line with expectations. Foreign investors bought a net $35.4 bln of long-term assets, down from a revised $81.5 bln in April. Overall, including short-term securities, foreign investors bought $17.5 bln after a revised $13 bln in April.

Foreign investors bought Treasuries and Agencies, but were sellers of corporate bonds and stocks. Note that corporate bonds include muni bonds and the Build America Bonds, which foreign investors had been keen buyers of previously.

It appears that both China and Japan reduced their Treasury holdings. Officials overall sold $38.8 bln of Treasuries, and China and Japan account for more than this, meaning that others central banks were net purchasers.

The was not much of a reaction to the TIC data. The euro, which reached a high in early NY around $1.3008 has pullback half a cent amid profit-taking ahead of the weekend. Sterling has returned to the session lows, while the dollar is pushing further below JPY87. The dollar bloc currencies remain under pressure.
TIC Data: No Significant Surprises TIC Data: No Significant Surprises Reviewed by Marc Chandler on July 16, 2010 Rating: 5
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