Azernews.Az

By Bloomberg

Overseas central banks are piling into Treasuries in the face of the longest market rout this year.

Foreign official accounts raised their holdings of U.S. securities in custody at the Federal Reserve to $2.99 trillion as of May 13, the highest level in 2015, based on Fed data. The purchases came amid a selloff that pushed U.S. 10-year yields to a six-month high of 2.36 percent this week.

“For governments and central banks, this is a big chance to buy Treasuries,” said Wontark Doh, head of overseas fixed- income investment in Seoul at Samsung Asset Management, which oversees $112.5 billion. “The Treasury yield compared to other countries is attractive.”

Benchmark U.S. 10-year yields were little changed at 2.22 percent as of 12:20 p.m. in Tokyo, according to Bloomberg Bond Trader data. It has climbed from this year’s low of 1.64 percent set in January. The price of the 2.125 percent note due in May 2025 was 99 6/32.

The yield is 94 basis points higher than the average of the other Group of Seven nations, according to data compiled by Bloomberg.

U.S. government securities are headed for a fourth weekly loss, the longest run of declines since December. The Bloomberg U.S. Treasury Bond Index has fallen 2 percent during the period.

The U.S. plans to report total overseas holdings of Treasuries for March on Friday. Japan overtook China as America’s largest creditor in February, though holdings in both nations declined.