Foreign accounts showed much less appetite for long-term U.S. securities in March than prior months. The month's net inflow of $61.8 billion is strong only on the surface, reflecting what is a modest inflow of $18.6 from foreign accounts and mostly an oversized $43.2 billion in net selling of foreign securities by U.S. accounts.
Foreign accounts had been pouring into the U.S. stock market late last year and into January but turned sellers in February, at minus $0.3 billion, and especially March at minus $21.8 billion. But foreigners were big buyers of corporate bonds in March, at $23.4 billion, and also government agency bonds at $25.2 billion. But interest in U.S. Treasuries was down as they sold a net $4.9 billion. Chinese accounts increased their holdings of Treasuries by $11.0 billion in the month to $1.188 trillion but Japanese accounts trimmed their holdings substantially, down $16.5 billion to $1.044 trillion.
This report has been bumpy in recent months but still positive. Inflows of long-term securities help the nation offset its large trade and government deficits.