Japan and China lead flight from the dollar Japan and China led a record withdrawl of foreign funds from the United States in August, heightening fears of a fresh slide in the dollar and a spike in US bond yields. Data from the US Treasury showed outflows of $163bn (£80bn) from all forms of US investments. "These numbers are absolutely stunning," said Marc Ostwald, an economist at Insinger de Beaufort. Asian investors dumped $52bn worth of US Treasury bonds alone, led by Japan ($23bn), China ($14.2bn) and Taiwan ($5bn). It is the first time since 1998 that foreigners have, on balance, sold Treasuries. [The US] requires $70bn a month in capital inflows to cover its current account deficit, but the key sources of finance are drying up one by one.
Japan and China led a record withdrawl of foreign funds from the United States in August, heightening fears of a fresh slide in the dollar and a spike in US bond yields.
Data from the US Treasury showed outflows of $163bn (£80bn) from all forms of US investments. "These numbers are absolutely stunning," said Marc Ostwald, an economist at Insinger de Beaufort.
Asian investors dumped $52bn worth of US Treasury bonds alone, led by Japan ($23bn), China ($14.2bn) and Taiwan ($5bn). It is the first time since 1998 that foreigners have, on balance, sold Treasuries.
[The US] requires $70bn a month in capital inflows to cover its current account deficit, but the key sources of finance are drying up one by one.
Indian regulator sparks market chaos The Indian stock exchange see-sawed spectacularly yesterday after regulators revealed plans to limit the flow of foreign money into Indian shares to avert the risk of the market overheating. The proposed controls on offshore derivative instruments caused chaos on the Mumbai Stock Exchange with the benchmark Sensex index falling nearly 10 per cent within minutes of opening before trading was suspended. Palaniappan Chidambaram, India's Finance Minister, moved quickly to dispel "alarmist" fears that foreign investment in Indian companies was unwelcome, boosting investor confidence. Most of the lost ground was made up after trading resumed with the index closing less than 2 per cent lower.
The Indian stock exchange see-sawed spectacularly yesterday after regulators revealed plans to limit the flow of foreign money into Indian shares to avert the risk of the market overheating.
The proposed controls on offshore derivative instruments caused chaos on the Mumbai Stock Exchange with the benchmark Sensex index falling nearly 10 per cent within minutes of opening before trading was suspended. Palaniappan Chidambaram, India's Finance Minister, moved quickly to dispel "alarmist" fears that foreign investment in Indian companies was unwelcome, boosting investor confidence. Most of the lost ground was made up after trading resumed with the index closing less than 2 per cent lower.
Most Asian markets fall as Indian markets are roiled and oil prices remain high
