Rebuilding reserves means U-turn on treasuries: Southeast Asia | Bangkok Post: business

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Central banks rebuilding reserves

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Southeast Asian central banks are rebuilding their foreign-currency reserves, raising the prospect they will boost holdings of United States Treasuries for the first time since February. 

Thailand, Singapore, Indonesia, Malaysia and the Philippines reported increases of about 1% to 3% in their international foreign-exchange holdings in September from the previous month, paring the combined decline this year to 2.6%. Monetary authorities in Asia are among the most aggressive sellers of US debt in 2013 as Thailand, Singapore and Malaysia each reduced ownership by between 20% and 28% through August, data compiled by Bloomberg show.

Policy makers may resume Treasury purchases in the coming months as reserves rise, said Todd Elmer, head of Group-of-10 strategy for Asia ex-Japan at Citigroup Inc. in Singapore. Asian exchange rates rebounded in October after the Federal Reserve unexpectedly maintained stimulus last month, helping revive overseas investment and lessening the need for central banks to intervene to support their currencies.

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