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USD TIC Long-Term Purchases, Sep 18, 2025

TIC Long-Term Purchases: Latest Data Signals a Shift in International Investment Flows (September 18, 2025)

The latest release of the TIC (Treasury International Capital) Long-Term Purchases data on September 18, 2025, has revealed a figure of 49.2B USD. This stands in stark contrast to both the forecast of 97.2B USD and the previous reading of 150.8B USD. While the impact is classified as "Low," this significant drop warrants closer examination as it offers valuable insights into international capital flows and potential implications for the US Dollar.

Given the usual effect of the data, an 'Actual' figure greater than the 'Forecast' is typically considered positive for the currency. However, in this instance, the significantly lower 'Actual' reading compared to the 'Forecast' suggests a weakening of demand for US long-term securities, which could exert downward pressure on the USD. The substantial decrease from the previous period further reinforces this concern. Let's delve deeper into understanding what the TIC Long-Term Purchases data represents and why this latest release deserves attention.

Understanding the TIC Long-Term Purchases Data

The Treasury International Capital (TIC) Long-Term Purchases, also known as Net Long-term Securities Transactions, is a key indicator released monthly by the US Department of the Treasury. It provides a comprehensive snapshot of the difference in value between foreign long-term securities purchased by US citizens and US long-term securities purchased by foreigners during the reported period. Think of it as a balance sheet reflecting the net flow of capital into and out of the US relating to long-term investments like stocks and bonds.

More specifically, as the ffnotes clarify, the data represents the balance of domestic and foreign investment. For example, if foreigners purchased $100 billion in US stocks and bonds, and the US purchased $30 billion in foreign stocks and bonds, the net reading would be 70.0B.

The data is released approximately 45 days after the month ends, providing a slightly delayed but crucial perspective on investment activities. The next release is scheduled for October 17, 2025.

Why Traders Care: The Link Between Securities and Currency Demand

The reason traders meticulously monitor the TIC Long-Term Purchases data lies in its direct link to currency demand. As stated in the whytraders care section, demand for domestic securities and currency demand are inextricably linked. Foreigners need to purchase the domestic currency (in this case, the US Dollar) to purchase the nation's securities (US stocks and bonds). Therefore, a higher TIC Long-Term Purchases figure typically indicates greater demand for US assets, leading to increased demand for the US Dollar and potentially a stronger currency.

Analyzing the September 18, 2025 Release in Detail

The substantial drop in the TIC Long-Term Purchases to 49.2B USD suggests a significant slowdown in foreign investment in US long-term securities. Compared to the forecast of 97.2B USD and the previous reading of 150.8B USD, this reveals a noticeable shift in international investment sentiment.

Several factors could be contributing to this decline:

  • Shifting Global Economic Conditions: Changes in global economic growth prospects, relative interest rates, or risk appetite could influence investment decisions. Investors might be diverting capital to other markets perceived as offering better returns or lower risk.
  • Geopolitical Uncertainty: Increased geopolitical tensions or uncertainty can make investors more cautious, leading them to reduce exposure to US assets.
  • Changes in US Monetary Policy: Perceived changes in the Federal Reserve's monetary policy stance can influence investment decisions, particularly in fixed-income securities. For example, expectations of lower interest rates might make US bonds less attractive to foreign investors.
  • Domestic Economic Performance: Concerns about the US economic outlook could also contribute to reduced investment. Weaker-than-expected economic data or forecasts could dampen investor enthusiasm.

Implications for the US Dollar

While the impact is labeled as "Low," traders should remain vigilant and consider the context surrounding the release. The lower-than-expected reading suggests potentially weakening demand for the US Dollar. However, the actual impact on the currency will depend on other factors influencing the market, such as overall risk sentiment, other economic data releases, and central bank policies.

Conclusion

The latest TIC Long-Term Purchases data released on September 18, 2025, presents a concerning picture. The significant drop compared to both the forecast and the previous reading points to a weakening of foreign investment in US long-term securities. While the immediate impact on the US Dollar might be limited, traders should closely monitor subsequent releases and related economic indicators to gauge the potential for further shifts in international capital flows. Understanding the underlying drivers behind this trend will be crucial for navigating the market in the coming months. The next TIC release on October 17, 2025, will be pivotal in confirming whether this is a temporary blip or the start of a more sustained trend.