Foreign US Treasury Holdings Surge to Record $9.36 Trillion in November
Foreign holdings of US Treasuries reached a record $9.36 trillion in November, rising 7.2% year-on-year as investor confidence returned following the end of the 43-day government shutdown. Japan led increases with holdings at $1.20 trillion, while Canada posted a sharp 13% monthly rise to $472.2 billion. China continued reducing exposure to $682.6 billion, the lowest since 2008, even as overall foreign capital inflows totaled $212 billion for the month.
*this image is generated using AI for illustrative purposes only.
Foreign investors demonstrated renewed confidence in US government debt during November, driving Treasury holdings to an unprecedented level as political uncertainty subsided. The surge came after the resolution of the longest federal government shutdown in US history, which lasted 43 days before ending on November 12 when Trump signed a funding bill into law.
Record-Breaking Treasury Holdings
Foreign holdings of US Treasuries climbed to an all-time high, reflecting strong international demand for American government debt:
| Metric | November | October | Change |
|---|---|---|---|
| Total Foreign Holdings | $9.36 trillion | $9.24 trillion | +$112 billion |
| Year-on-Year Growth | - | - | +7.20% |
| Net Monthly Inflows | $85.60 billion | -$60.10 billion | +$145.70 billion |
The November increase marked a significant turnaround from the previous two months of declines, as global investors returned to US government securities following the shutdown resolution.
Major Holders Drive Growth
Japan maintained its position as the largest non-US holder of Treasuries, extending an impressive streak of increases. The country's Treasury portfolio reached $1.20 trillion in November, representing its highest level since July 2022 and marking the 11th consecutive month of increases.
The United Kingdom, serving as the second-largest foreign holder, also expanded its exposure with holdings rising to $888.50 billion, approximately 1.20% higher than October levels. As a key custody hub for global investors, UK holdings often reflect broader hedge fund activity and international investment flows.
Canada posted one of the most dramatic monthly increases, boosting its Treasury holdings by 13.00% to a record $472.20 billion. This surge represented a remarkable reversal from April, when Canadian holdings fell sharply following US tariffs on Canadian steel, aluminum, and automobiles.
China Continues Reduction Strategy
In contrast to the broader trend, China maintained its strategy of reducing US government debt exposure. Chinese Treasury holdings slipped to $682.60 billion in November, marking the lowest level since September 2008. Despite remaining the third-largest foreign holder, China's holdings have declined by more than 10.00% since the start of 2025.
Favorable Market Conditions
Market dynamics during November supported increased demand for US Treasuries. The benchmark 10-year US Treasury yield began the month at 4.11% and ended nearly nine basis points lower at 4.02%, creating attractive entry points for international investors.
Broader Capital Flows
The appetite for US assets extended beyond government bonds, with foreign investors purchasing $92.20 billion worth of US equities in November, up from $60.30 billion in October. Overall capital flows showed a net inflow of $212.00 billion into the United States during the month, completely reversing the revised outflows of $22.50 billion recorded in October.
The November Treasury inflows of $85.60 billion, while substantial, remained below the year's peak of $147.40 billion recorded in May, which represented the largest monthly total since August 2022.
20
