April 2011 U.S. Treasury Statement and Debt Overview

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Outlays of $330.0 billion and receipts of $289.5 billion added another $40.5 billion to the federal budget deficit in April, a month that typically sees revenue exceeding outlays. The U.S. federal debt held by the public stood at $14.288 trillion at the end of April.
 

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Foreigners held $4.479 trillion, or a little less than one-third of the U.S. public debt at the end of March 2011. China remained the largest foreign creditor ($1.144 trillion) despite selling $9.2 billion of Treasury securities, its fifth straight month as a net seller. The United Kingdom was the biggest buyer in both absolute ($29.7 billion) and percentage change (10.1 percent) terms. Taiwan replaced the Caribbean Banks as the fifth largest foreign holder of U.S. debt. Interestingly, holdings by the “other” (aggregated) category have been trending lower since last November, dropping $53 billion over that time period.
 

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The Federal Reserve put more distance between itself and both China and Japan during March in terms of U.S. Treasury holdings. Moreover, were the Fed to maintain its March rate of Treasury purchases for a year, it would more than double its current holdings. As mentioned above, China was a net seller in March, while Japan’s added to its holdings despite the March 11 earthquake and tsunami.

More recent data shows the Fed has ramped up purchases of U.S. Treasury debt since March, and held nearly $1.5 trillion as of mid-May.
 

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Flows into the United States for all types of investments were greater than outflows in March, as evidenced by the positive three-month-average net inflows shown by the Treasury International Capital (TIC) accounting system. Virtually all of the increase appears to have occurred in the “Change in Banks' Own Net Dollar-denominated Liabilities” category, however.
 

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Short-term U.S. securities (e.g., T-bills) continued to decline in March, although at a somewhat slower pace. With the exception of October, foreign investors have been net sellers of short-term U.S. debt during every month since September 2010.
 

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Net inflows into long-term public debt rose by $13.2 billion (to $36.275 billion) in March, but the three-month moving average declined because inflows dried up during February. Purchases of private securities also jumped by $14.91 billion in March, to $18.465 billion.