Treasuries' Worst Drop in 2010 Driven by Central Bank Sales: Chart of Day

22 December 2010


 Central banks outside the U.S. sold Treasuries at the end of November and in December for the first time since June, spurring the biggest monthly loss in a year for the government securities.

The CHART OF THE DAY graphs Treasuries held at the Federal Reserve by foreign central banks and governments. It also shows U.S. 10-year yields climbing in December to a seven-month high. So-called custody holdings rose to a record $2.611 trillion on Nov. 17, according to the U.S. central bank. The figure dropped $2.25 billion in the last week of November, and foreign official holders have sold $1.5 billion of Treasuries in December.