Signal Over Story: What TIC Data Really Shows

Signal Over Story: What TIC Data Really Shows

• Headlines once more warn of a foreign exodus from U.S. bonds.

• Despite brief dips, most months over the last two years show gains.

• Today, foreign holdings of Treasurys are pushing record highs.

One of the hardest parts about investing is separating the signal from the noise…

Traditional financial media is in a strange spot. Their coverage of markets—especially anything tied to the Federal Reserve—has become increasingly formulaic. After every policy meeting, the same pattern plays out: find the most alarming data point, elevate it, and let the headlines do the rest. Instead of focusing on what actually drives markets, they chase the angle most likely to spark anxiety.

It’s not entirely their fault. Their audience is shrinking. According to Nielsen’s latest January 2026 data, broadcast networks now account for just 21.5% of all TV viewing, with cable at 21.2%, both well below their historical norms. Print is following the same trajectory. As streaming platforms, social media, and short‑form video eat into their relevance, legacy outlets are fighting over a smaller and more distracted audience. During the pandemic, they learned that fear travels faster than nuance, and they’ve been programming around that lesson ever since.

A recent example: the supposed collapse of international demand for U.S. Treasurys. Last April, when the White House rolled out its initial tariff plan, the 10‑Year yield jumped from 3.9% to 4.5%. Headlines immediately declared that foreign buyers were abandoning U.S. debt for good, chasing safer or more attractive opportunities abroad. By mid‑May, yields touched 4.6% before easing. And now, as this year gets underway, the same storyline has resurfaced…

But here’s the part that rarely gets airtime: when the narrative changes, the noise rarely updates with it. Whether it’s a reluctance to appear overly optimistic or a belief that good news doesn’t convert, follow‑through is often missing. Investors are left reacting to echoes rather than reality.

The reality, according to the latest Treasury Department data, is straightforward… foreign holdings keep rising, setting new records over the past 12 months. If domestic rate cuts continue and global political uncertainty persists, demand for U.S. Treasurys should strengthen even more.

But don’t take my word for it, let’s look at what the data’s telling us…

U.S. Treasurys remain one of the safest assets on the planet. They’re liquid, they can be sold quickly to raise cash, and they provide reliable income. The U.S. dollar is still the world’s primary reserve currency, which means global transactions require dollar‑denominated assets. That creates a constant baseline demand for U.S. debt.

The cleanest way to track foreign appetite is through Treasury International Capital (“TIC”) data. It offers a monthly snapshot of who’s buying and selling Treasurys, stocks, and corporate bonds. Headlines focus on yields and politics, but TIC data reveals the deeper story behind global capital flows. It’s one of the few tools that helps investors separate emotion from reality.

The chart below shows foreign Treasury holdings from April 1970 through December 2025 (the most recent data). The line keeps climbing, recently hitting a new high near $9.4 trillion…

Since the current administration took office, it’s made one priority clear: push borrowing costs lower. Treasury Secretary Scott Bessent has said the government will use every lever it controls to do it. The logic is simple. Most major loans (mortgages, auto financing, business credit) ultimately hinge on the 10‑year yield. Bring that benchmark down, and households spend less on debt while businesses find it easier to borrow and invest.

That’s why the latest narrative has zeroed in on the Federal Reserve’s independence. As Jerome Powell’s term nears its end in May, the White House initially floated National Economic Council Director Kevin Hassett as the next Fed Chair. Markets bristled. Investors worried he was too closely aligned with the administration, raising fears that monetary policy could tilt toward political priorities. Commentators warned foreign governments might rethink their economic ties with the U.S. if the Fed appeared compromised.

But the tone shifted quickly…

Bond investors pushed back, selling Treasurys and driving yields from 4% to 4.3%. The White House recalibrated and announced Kevin Warsh, viewed as more independent and policy‑hawkish, as its nominee. Markets steadied, and yields have since slipped back below 4.1%.

Still, the narrative hasn’t caught up. Financial news outlets like Bloomberg and CNBC are still talking about foreign dollars pulling out of the U.S. Yet the data from the past year tells a different story…

The chart above shows foreign Treasury holdings since mid‑2024. Yes, there were brief pullbacks. But each dip was followed by an even stronger rebound. Total holdings made several new highs throughout the year.

And to institutional investors, U.S. politics may look messy—but they’re seeing similar issues elsewhere.

Europe is wrestling with its own political crosscurrents. German Chancellor Friedrich Merz faces deep domestic trust issues. In France, President Emmanuel Macron has cycled through multiple governments in the past five years, culminating in the first successful parliamentary no‑confidence vote since 1962.

And now another layer of uncertainty has emerged: European Central Bank President Christine Lagarde is reportedly weighing an early exit, raising questions about continuity at the institution responsible for anchoring the region’s financial stability. It’s not dramatic enough to trigger a continental crisis, but persistent enough to push global investors toward safer ground.

At the end of the day, don’t get caught up in the noise. Focus on the signal. Foreign money managers and governments continue putting capital to work in U.S. assets. Treasurys remain liquid and income‑generating. The dollar is still the world’s reserve currency. And if the Fed keeps easing, yields could fall even further. All of this points to a steady, long‑term rally for U.S. Treasurys.

Five Stories Moving the Market:

Japan's annual core consumer inflation hit a two-year low in January, matching the Bank of Japan's 2% target; easing fuel and food costs help drive the result while services inflation held steady below 2% – Reuters. (Why you should care – easing inflation growth will likely increase pressure on the BOJ to stop raising interest rates)

U.S. President Donald Trump is weighing an initial limited military strike on Iran to force it to meet his demands for a nuclear deal, a first step that would be designed to pressure Tehran into an agreement but fall short of a full-scale attack that could inspire a major retaliation – WSJ. (Why you should care – while this shouldn’t come as a surprise due to the slow and methodical buildup, it could stoke geopolitical tension concerns)

Bank of America is committing $25 billion to private credit deals, as the Wall Street giant prepares a war chest to further its advance in the lucrative slice of finance – Reuters. (Why you should care – the recent commitment by Wall Street banks to provide financing in the private credit sector should help to boost the liquidity outlook)

US mortgage rates fell to the lowest level since September 2022 as affordability slowly improves; the average for 30-year, fixed loans was 6.01%, down from 6.09% last week and compared to 6.85% a year ago, according to data from Freddie Mac – Bloomberg. (Why you should care – easing mortgage rates should help to boost refinancing activity and economic growth)

Imports to the U.S. grew to a record high in 2025, leaving the trade deficit little changed despite steep Trump administration tariffs aimed at closing trade gaps; the nation’s trade deficit was $901.5 billion last year, slightly smaller than the $903.5 billion deficit recorded in 2024 – WSJ. (Why you should care – digital equipment and computer accessories drove import demand late in the year, pointing to continued demand for AI-related goods)

Economic Calendar:

Markets are closed in China

Earnings: HBM, LAMR, WU

China – PBoC Loan Prime Rate for February

Japan – National CPI for January

Japan – au Jibun Bank Manufacturing, Services, Composite PMI (Preliminary) for February

U.K. – Retail Sales for January (2 a.m.)

U.K. – Public Sector Net Borrowing for January (2 a.m.)

Eurozone – HCOB Eurozone Manufacturing, Services, Composite PMI (Preliminary) for February (4 a.m.)

U.K. – S&P Global U.K. Manufacturing, Services, Composite PMI (Preliminary) for February (4:30 a.m.)

U.S. – PCE Price Index for December (8:30 a.m.)

U.S. – GDP for Q4 (8:30 a.m.)

U.S. – Personal Income, Spending for December (8:30 a.m.)

Fed’s Bostic (Atlanta, Non-Voter) Speaks (9:45 a.m.)

U.S. – S&P Global U.S. Manufacturing, Services, Composite PMI (Preliminary) for February (9:45 a.m.)

U.S. – University of Michigan Consumer Sentiment (Final) for February (10 a.m.)

U.S. – New Home Sales for December (10 a.m.)

BOC Senior Loan Officer Survey for Q4 (10:30 a.m.)

U.S. - Baker Hughes Rig Count (1 p.m.)

U.S. - CFTC’s Commitment of Traders Report (3:30 p.m.)

Fed Releases Balance Sheet Updates on Commercial Banks (4:15 p.m.)