Foreign U.S. Treasuries Fall in June

Foreign holdings of U.S. Treasuries fell to about $9.299 trillion in June, led by declines from Japan, the United Kingdom, and China, according to Treasury data cited by Reuters and other outlets. Japan remained the largest non-U.S. holder, with holdings dipping to roughly $1.116 trillion, while the UK declined to $939.9 billion and China to $633.4 billion, the lowest since 2008 for China. Despite the monthly drop, total foreign holdings were still up about 2.3% from a year earlier, and June saw overall net capital inflows of $133.5 billion into U.S. financial assets. On a transactions basis, June experienced $6.8 billion in Treasury inflows, down from May’s $56.6 billion, indicating softer foreign demand for Treasuries. The pattern of declines from major holders comes as overseas demand for U.S. debt eases, even as other U.S. assets such as corporate bonds and equities attract inflows. These dynamics continue to influence market expectations for U.S. borrowing costs and currency flows, with Japan’s position as the leading non-U.S. holder and the UK and China’s shifts highlighted across multiple reporting outlets.