Global Investors Maintain Strong Appetite for U.S. Treasurys Despite Trade Tensions
Foreign investors injected over $300 billion into U.S. assets during August and September, dispelling fears of a mass exodus from Treasury securities. This sustained demand plays a critical role in stabilizing borrowing costs for American households, even amid ongoing trade disputes and de-dollarization debates.
The Treasury Department's latest data reveals no evidence of the anticipated selloff following April's aggressive tariff announcements. "The 'Sell America' narrative lasted barely a week. Since then, capital has consistently flowed back into U.S. markets," noted Benjamin Schroeder of ING, highlighting the resilience of dollar-denominated debt.
Market stability hinges on this continued foreign participation. A sudden withdrawal from Treasury holdings could trigger dangerous interest rate volatility, potentially disrupting everything from mortgage rates to corporate financing.
