Question;Several years ago, an article in the Economist stated, ?... foreign central banks seem to have reduced their purchases of American Treasuries: official holdings of these rose by only $2 billion in the first seven months of 2005, against $295 billion in (the whole of) 2004 and $175 billion in 2003. If this trend continues, other currencies could one day challenge the dollar's dominance...?Has this trend continued? What impact might such a reduction in purchases of U.S. treasury securities have on the cost of short- and long-term financing? If the central bank of another country increases interest rates, how does that affect purchase of American Treasuries?Does Turkey purchase American Treasuries? To what extent?
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