economy
Japan, China lead foreign government retreat from U.S. Treasurys as Iran war fallout stokes currency fears
The sell-off came as the outbreak of the U.S.-Iran conflict and resulting surge in crude oil prices sent the yen and other Asian currencies tumbling.
TL;DR
- China and Japan significantly reduced their U.S. Treasury holdings in March.
- The sell-off is linked to the U.S.-Iran conflict and the resulting surge in crude oil prices.
- Central banks sold dollar reserves to defend local currencies against tumbling exchange rates.
- Regional economies dependent on oil imports faced a significant energy shock.
- Falling bond prices also contributed to a valuation loss for foreign investors.
- The U.K. was an exception, increasing its holdings.