The United States’ net foreign purchases of long-term securities slowed in May, although foreign private institutions are still willing buyers of U.S. Treasury and corporate debt. Foreign official institutions remained net sellers in the month.
Net buying increased a smaller USD45.6 billion, down from April’s USD94.0 billion jump. Foreign private buyers accounted for all of the long-term gain, as foreign official institutions continued to be net sellers in May. Foreign private buyers continue to unload equities, selling a net USD27.8 billion in May, the largest outflow since 2007.
Foreign private buyers continue to have a strong appetite for long-term U.S. Treasury securities, with net foreign private purchases rising USD50.5 billion in May, on the heels of a similarly solid USD43.5 billion increase in April.
"Capital inflows remain relatively healthy; but, as trade rhetoric has heated up more recently, we will be watching for how this impacted demand for U.S. securities in June," Wells Fargo Securities commented in its latest research report.


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