Hiking its holding by USD 8 billion in just a month, India’s exposure to US government securities rose to USD 91.2 billion at the end of January this year.
This is also the highest level in more than one year. Latest data from the Treasury Department show that India held securities worth USD 91.2 billion in January compared to USD 83 billion in December last year.
The steep rise in holding also comes at a time when the world’s largest economy is seeing relatively better recovery. China remains the largest holder of these securities with exposure to the tune of USD 1.24 trillion in January.
Among the BRIC (Brazil, Russia, India, China) grouping, India has the third highest holding after China and Brazil (USD 256.5 billion).
In January, Russia’s exposure stood at USD 82.2 billion. Since October 2014, India has been hiking its exposure when it stood at USD 77.5 billion. The next month the same was raised to USD 80.5 billion.
According to the Treasury Department, the sum total in January of all net foreign acquisitions of long-term securities, short-term securities and banking flows touched USD 88.3 billion.
Out of the total, net foreign private inflows were USD 60.7 billion, and net foreign official inflows were USD 27.6 billion.
“Foreign residents decreased their holdings of US Treasury bills by USD 10.8 billion. Foreign resident holdings of all dollar-denominated short-term US securities and other custody liabilities decreased by USD 8.1 billion,” it said in a recent statement.
Meanwhile, the US economy expanded 2.2 per cent in the fourth quarter of 2014. The country’s real GDP is the value of production of goods and services adjusted for price changes.