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Foreign holdings of US Treasury securities dip 0.1 percent to $6.06 trillion in September

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WASHINGTON — Foreign buyers of U.S. Treasury securities trimmed their holdings slightly in September after hitting a record in the previous month.

The Treasury Department said in its monthly report Tuesday that foreign holdings dipped 0.1 percent to $6.06 trillion in September after hitting an all-time high of $6.07 trillion in August.

China, the top foreign buyer of U.S. Treasury debt, trimmed its holdings by 0.3 percent to $1.27 trillion in September. Japan, the No. 2 buyer, reduced its holdings by 0.7 percent to $1.22 trillion.

PHOTO: FILE - In this Nov. 13, 2014 file photo, a man looks at an electronic stock board of a securities firm in Tokyo. The Treasury Department releases foreign holdings data for August on Tuesday, Nov. 18, 2014. (AP Photo/Shizuo Kambayashi, File)
FILE - In this Nov. 13, 2014 file photo, a man looks at an electronic stock board of a securities firm in Tokyo. The Treasury Department releases foreign holdings data for August on Tuesday, Nov. 18, 2014. (AP Photo/Shizuo Kambayashi, File)

Foreign governments through their central banks are big holders of U.S. Treasury debt, which is viewed as one of the world's safest investments. In September, foreign governments cut their holdings by 0.4 percent to $4.14 trillion.

Foreign governments account for 68 percent of the total holdings of Treasury debt.

Demand for Treasury securities is expected to remain strong for the rest of this year and into 2015 in part because Treasury debt is seen as a safe haven amid geopolitical tensions.

Foreign demand has also been bolstered by a congressional agreement to avoid a fight over raising the U.S. debt ceiling until March 2015 when a current suspension of the borrowing limit expires.

After Republicans won enough seats to take control of the Senate next year, Sen. Mitch McConnell, who is in line to become majority leader, said there would be no default on the government's debt or a government shutdown under Republican control of both the House and Senate. However, since McConnell made that statement on Nov. 5, other Republicans have suggested that Congress should use all its powers in upcoming battles with President Barack Obama and other Democrats.

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