US TIC Data Below Expectations

International purchases of U.S. financial assets rose less than forecast in October as confidence grew that European leaders were moving toward resolving their debt crisis.

Net buying of long-term equities, notes and bonds totaled $1.3 billion during the month, down from net purchases of $3.2 billion in September, the Treasury Department said today in Washington. Economists surveyed by Bloomberg projected net buying of $25 billion of long-term assets, according to the median estimate.

“Flows into U.S. assets are likely to rebound in the last two months of the year as heightened anxiety about the impending U.S. fiscal austerity pushes foreign investors back into Treasuries,” Millan Mulraine, senior U.S. strategist for TD Securities Inc. in New York, said before the report was released.

European Union leaders capped a third year of debt-crisis management with Greece ready to obtain fresh financial aid and a euro bank regulator taking shape. Financial-market tensions have abated, thanks mainly to a pledge by the European Central Bank, first made in late July and yet to be acted on, to put a floor under the bond markets of vulnerable countries such as Spain or Italy.

Bloomberg

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