Deep Dive: Foreign Holdings of U.S. Treasuries Climb

The video discusses the increase in foreign holdings of US Treasurys, highlighting that the usual suspects, China and Japan, were not the main drivers. Instead, countries like the Cayman Islands, Ireland, UK, and Luxembourg saw increased holdings, largely due to institutional investors. This trend could reverse quickly if these investors decide to sell. Despite a low yield of 1.7% on the 10-year Treasury, it remains attractive compared to other global investment options.

What role do custodial holdings play for global investors?

Why might the 1.7% yield on the 10-year Treasury be considered attractive?