Data shows that in recent years, foreign investors have been continuously reducing their holdings of US Treasury bonds and agency bonds, while inflows into US stocks and corporate bonds have increased significantly.
Net purchases of stocks over the past 12 months have approached $900 billion, a historically high level; net purchases of corporate bonds have also rebounded significantly. Conversely, net purchases of US Treasury bonds have declined rapidly from their 2022-2023 highs, while net purchases of agency bonds are near zero.
This shift suggests that overseas funds are not optimistic about the risk-reward ratio of US government debt, but remain optimistic about the development prospects of excellent US companies; stocks and corporate bonds provide "US corporate credit."
