"Dumping America" theory temporarily not valid: Overseas investors bought a net of $1.55 trillion in U.S. long-term financial assets last year.

Data released by the US Treasury Department on Wednesday shows that the pace of non-US investors buying US financial assets is accelerating, driven primarily by demand for stocks and US Treasury bonds. This provides a strong rebuttal to the increasingly popular narrative of "Sell America" in the market: In 2025, overseas investors net purchased $1.55 trillion of US long-term financial assets, higher than the previous year's net purchase of $1.18 trillion. Among them, $658.5 billion flowed into stocks, $442.7 billion into US Treasury bonds, including medium and long-term bonds. US President Trump's frequent threats to significantly increase tariffs have raised concerns in the market, fearing that foreign investors may sell off US assets and US dollars. Earlier, amid Trump's pressure on Denmark over the Greenland issue, a Danish pension fund warned last month that it planned to exit its holdings of US Treasury bonds. The largest pension fund in Europe, Stichting Pensioenfonds ABP from the Netherlands, also significantly reduced its exposure to US assets last year. However, US Treasury Secretary Mnuchin repeatedly refuted the "Sell America" narrative, believing that the US government's economic policies have strengthened the US as the preferred destination for global capital. Industry insiders said, "There are indeed geopolitical instability factors currently, so shorting the US dollar has become popular. However, fundamentally, US Treasury bonds account for a large proportion of global sovereign debt holdings, and this situation is unlikely to change." The depreciation of the US dollar last year may even encourage some foreign asset managers to increase their holdings of US securities. Some analysts have indicated that this was the case after Trump's tariff declaration on "Liberation Day" in April last year caused significant market volatility. Data shows that cross-border investors took advantage of the US dollar valuation adjustment opportunity and increased their allocations to US stocks. Although the allocation strength is not as strong as during the "US exceptionalism" period from 2023 to 2024, cross-border premiums still exist. US Treasury Department data shows that many overseas investors were willing to increase their holdings of US assets last year. Apart from stocks and bonds, there was a net purchase of $327.8 billion of corporate bonds. Net purchases of agency bonds, including Freddie Mac and Fannie Mae, amounted to $112.9 billion. Major countries and regions holding US bonds In terms of December figures, foreign investors' holdings of US Treasury bonds decreased by $88.4 billion to $9.27 trillion, the lowest level since October. As the largest foreign holder of US government debt, Japan reduced its holdings by $17.2 billion to $1.19 trillion; the UK reduced its holdings by $23.0 billion to $866 billion; mainland China reduced its holdings by $0.4 billion. Overall for the year, Europe contributed $872.8 billion in net inflows of long-term financial assets (with a term exceeding one year). The Cayman Islands had a net purchase of $277.2 billion, Japan had a net purchase of $56.0 billion, and Canada had $84.4 billion. China decreased its net holdings of US long-term financial assets by $208.6 billion. China's holdings of US Treasury bonds fell to $683.5 billion, the lowest level since 2008. The US Treasury Department warned that identifying the ultimate source of asset holders is difficult. Some of the largest net buyers come from tax haven regions such as the Cayman Islands and Guernsey; others come from global financial centers such as the UK and Belgium. Other key points of TIC data The US Treasury Department's TIC data also shows: In December, the total net inflow of foreign purchases of all long-term securities, US short-term securities, and bank funds was $44.9 billion. Of this, the net inflow from the foreign private sector was $32.7 billion, and the net inflow from foreign official sectors was $12.2 billion. In December, foreign residents increased their holdings of US long-term securities, netting $62.9 billion. Of this, foreign private investors net purchased $55.7 billion, and foreign official institutions net purchased $7.2 billion. US residents increased their holdings of foreign long-term securities, netting $34.9 billion. After adjusting for factors such as estimated composite investments in US stocks by foreign investors through stock swaps, the overall estimated net purchase of foreign long-term securities in December was $28.0 billion. Foreign residents increased their holdings of US Treasury securities by $9.7 billion. All US dollar-denominated US short-term securities and other custody liabilities held by foreign residents increased by $12.1 billion. Banks' own net liabilities denominated in US dollars to foreign residents increased by $4.8 billion. The TIC data for January from the US Treasury Department is scheduled to be released on March 18, 2026. This article was translated from Wall Street See by GMTEight, edited by Chen Wenfang.