Saudis Join China in Delivering Blows to U.S. Dollar: Central Banks Liquidate Record $346 Billion

Saudis Join China in Delivering Blows to U.S. Dollar: Central Banks Liquidate Record $346 Billion

(Mass Report) Financial analysts report foreign central banks continued their relentless liquidation of US paper held in the Fed’s custody account, which tumbled by another $22.3 billion in the past week,” as the Federal Reserve’s number of Treasuries held in custody is abruptly dropping.

The latest monthly Treasury International Capital data and the Federal Reserve’s custody data show the grim trend has even accelerated, “pushing the total amount of custodial paper to $2.805 trillion, another fresh post-2012 low” according to Zero Hedge.

Federal Reserve Treasury Holdings

Unsurprisingly, China sold $34 billion in US paper in July, the largest drop in a single month since 2012.

However more surprising, U.S. ally Saudi Arabia is also rapidly selling their TSY holdings.

Zero Hedge reported:

“What is becoming increasingly obvious is that both foreign central banks, sovereign wealth funds, reserve managers, and virtually every other official institution in possession of US paper, is liquidating their holdings at a very troubling pace.

In some cases, like China, this is to offset devaluation pressure; in others such as Saudi Arabia, it is to provide the funds needed to offset the collapse of the petrodollar, and to backstop the country’s soaring budget deficit.”

China Treasury Dump

Full Article: www.zerohedge.com

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