Bahrain holds US$1.2bn US treasury securities

Manama : Bahrain currently holds US$1.2 billion bonds issued by the US treasury and had a holding of around US$2.5 billion in the first months in 2007, a period just before the onset of global financial crisis. The holdings had then plunged very fast to touch US$800 million by June 2007. These details were revealed in the latest data release by the US treasury department.

The data release by the department made international headlines as it was the first time in the last 41 years, the treasury holdings of Saudi Arabia and many other oil exporting countries were declared separately.

“Since the US started releasing data on foreign ownership of Treasuries in 1974, the Treasury’s policy had been to group Saudi holdings in with 14 other mostly OPEC nations, including Kuwait, Nigeria and the United Arab Emirates” says a Bloomberg report.

The US$13.4 trillion treasuries market includes $1.2trn holdings by China and $1.1trn holdings by Japan. Saudi holdings are at $116.8 billion, according to the released
data.

The United Arab Emirates holds $62.5bn treasuries, Kuwait holds $31.2bn treasuries, Oman holds $15.9bn and Qatar has $3.7bn holdings.

US treasury bonds are considered to be the safe haven among asset classes and investors including various governments across the world flock to them on signs of trouble for the global economy. 

The yield from the treasury bonds has been quite low, near zero, for the last few years. The yield for two-year US note was trading around 0.8 per cent and the yield on the benchmark 10-year US note was around 1.75pc, according to market data.

The size of Saudi holdings is below expectations as the foreign exchange of the oil exporter is estimated at $587bn, according to reports.