[lbo-talk] dollar crisis postponed

Doug Henwood dhenwood at panix.com
Tue Jan 18 06:31:03 PST 2005


US net capital inflows jump to $81.0 bln in Nov Tue Jan 18, 2005 09:22 AM ET

WASHINGTON, Jan 18 (Reuters) - Net inflows of capital into U.S. assets surged to an unexpectedly high $81.0 billion in November, according to a Treasury Department report on Tuesday.

Net inflows of capital in November were the highest since $81.1 billion in June, rising from a revised $48.3 billion in October.

Bank analysts had been expecting net inflows -- the balance between foreign sales and purchase of U.S. assets and U.S. trading in foreign securities -- of around $55 billion.

Market participants watch the report as a measure of foreigners' appetite for U.S. assets.

Net inflows short of the U.S. current account deficit, which widened to a record $60.3 billion in November, could have increased selling pressure on the dollar because the United States depends on foreign investors buying U.S. assets like Treasury bonds finance the deficit.

Americans made net purchases of $16.1 billion in foreign stocks and net purchases of $2.6 billion in foreign bonds in November, the Treasury said.

Net purchases of U.S. securities by foreigners jumped to $99.7 billion in November from $65.4 billion in October, the data showed.

Foreigners bought a net $14.5 billion in equities in November and a net $32.0 billion in U.S. government bonds and notes.

Foreign accounts made net purchases in November of long-term U.S. agency bonds of $27.9 billion, up from $21.9 billion in October.

Foreigners' net purchases of U.S. corporate bonds were $25.3 billion in November, up from net purchases of $19.1 billion in October.



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