Saudi holdings of US treasury bills rose to $128.1bn in July

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  • The Kingdom is the 16th largest holder of US debt
  • This increase in June and July is in line with global trends, as countries around the world increased their holdings by 5.7 percent

For the second month in a row, Saudi Arabia’s holding of US Treasury securities rose in July, touching $128.1 billion.

According to new data from the US government, the holdings increased by 0.2 percent from June, and 2.8 percent from July last year. However, the Saudi holdings in July is down by 5.2 percent from the beginning of the year when it was $135.1 billion, the data showed.

This increase in June and July is in line with global trends, as countries around the world increased their holdings by 5.7 percent in the two months leading up to July.

However, analysis showed that Saudi holdings are still down from their peak of $184.4 billion in February 2020. As the global pandemic took hold in March last year, the Saudi government decreased its holding, as the Kingdom’s reserves were hit by the collapse in oil prices.

In July last year, Saudi Arabia began to boost its holdings once again, peaking in November and then continuing to decline by low single percentages till May 2021.

“The rise in US Treasury holding was expected “given the higher yields on US T-bills compared to bank deposit,” Dr. Mohamed Ramady, a London-based independent economist, told Arab News.

He said in the case of Saudi Arabia, higher oil prices have also provided it with more flexibility in its investment portfolio maturity profile.

The Kingdom is the 16th largest holder of US debt. Japan remains No.1 with $1310.2 billion in US bonds, followed by China ($1068.3 billion), the UK ($539.5 billion), Ireland ($319.7 billion) and Switzerland ($298.3 billion).

The UAE holds $58 billion, an increase of nearly 100 percent year-on-year. Kuwait holds $46.4 billion, down by 3.1 percent year-on-year.

 

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