Mar 16, 4:37 PM EDT

Foreign holdings of US Treasury debt hit $6.22 trillion



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WASHINGTON (AP) -- Foreign holdings of U.S. Treasury securities rose to a record level in January despite a cutback by investors in China, the largest foreign owner of Treasury debt.

The Treasury Department said Monday that foreign holdings increased 1 percent to $6.22 trillion.

China trimmed its holdings for a fifth month, reducing them 0.4 percent to $1.24 trillion after a 0.5 percent cut in December.

Japan, the No. 2 foreign buyer, boosted its holdings by 0.6 percent in January to $1.24 trillion. Before rounding, the Chinese total is $500 million higher than the Japanese.

Foreign governments, primarily through their central banks, account for two-thirds of the foreign holdings. For January, the total held by foreign governments rose 0.3 percent in January to $4.12 trillion.

In addition to the increase by Japan, other countries who padded their holdings in January included oil exporting nations and Caribbean banking centers, a group that includes the Bahamas and the Cayman Islands.

The expectation is that demand for Treasury securities, still viewed as one of the world's safest investments, will remain strong this year. While U.S. interest rates are still low, they are expected to climb this year once the Federal Reserve begins to raise interest rates.

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