Foreign cenbank agency holdings fall 6th week-Fed
NEW YORK, Nov 13 (Reuters) - Foreign central banks' holdings of U.S. agency securities at the Federal Reserve fell for six weeks in a row as they continued to favor the safe haven status of Treasury debt, Fed data on Thursday showed.
Their holdings of agency securities fell by $5.08 billion in the week ended Nov. 12 to $896.79 billion, following a $7.24 billion fall in the previous week.
This brought the cumulative drop in agency holdings among overseas central banks to $72.5 billion or 7.5 percent since the beginning of October.
A federal measure to guarantee short-term bonds issued by banks has been perceived to put them on a higher credit standing than securities issued by from mortgage agencies Fannie Mae, Freddie Mac and the Federal Home Loan Bank System.
In September the government took control of Fannie Mae and Freddie Mac in a bid to stabilize the faltering housing and financial markets. Investors have doubts about the degree of the government's backing of these securities.
Meanwhile, overseas central banks' holdings of U.S. Treasuries at the Fed jumped $13.95 billion in the latest week $1.608 trillion, following a $19.13 billion surge in the prior week.
The Fed's combined custody of Treasury and agency holdings for overseas central banks grew by $8.87 billion to $2.505 trillion in the latest week.
Overseas central banks, particularly those in Asia, have been huge buyers of U.S. debt in recent years, and own over a quarter of marketable Treasuries. (The full Fed report can be found at: here) (Reporting by Richard Leong, Editing by Chizu Nomiyama)
