Reply #40: Dollar Falls as U.S. Buying of Foreign Stocks Rises to Record

[54anickel]

http://www.bloomberg.com/apps/news?pid=20601083&sid=acC3UGMa8tSc&refer=currency

Jan. 17 (Bloomberg) -- The dollar fell against the euro and yen after a government report showed U.S. investors bought a record amount of foreign stocks in November.

International investors also bought less U.S. stocks in the month, while domestic investors doubled their purchases of foreign debt. Diminished demand for U.S. assets reduces the amount of dollars investors need to procure.

``The theme of diversification away from the dollar is still a concern,'' said Matthew Kassel, director of proprietary trading at ING Financial Markets LLC in New York.

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U.S. investors bought a net $21.2 billion of international stocks in November, Treasury Department data showed. It's the most since Bloomberg began compiling the data in 1977. U.S. investors also doubled the amount of foreign bonds they bought, to a net $17.8 billion, from $7.5 billion in October.

``The decline of home buying of U.S. assets will become an issue for the dollar,'' said Michael Metcalfe, a senior currency strategist at State Street Global Markets in London.

International investors added a net $1.8 billion of U.S. stocks in November, down from a net $23.2 billion the prior month. Net foreign buying of U.S. securities for the month totaled $107 billion, up from $104 billion in October. Who's doing the buying? That's what I wanna know. :freak:

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