U.S. Cross-Border Outflow of Capital Hits Highest Since 2009
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A measure of capital flowing in and out of the U.S. showed the biggest net selling since February 2009 as the Federal Reserve prepared to scale back its bond buying, according to Treasury Department data released today.
Investors sold a net $15.4 billion of long-term agency debt in December, the biggest monthly drop in those securities since September 2010 amid selling in Caribbean banking centers often used by hedge funds, the figures showed. They also sold U.S. stocks and corporate bonds, while China and Japan reduced holdings of Treasuries in the month the Fed decided to trim monthly asset purchases to $75 billion from $85 billion.