Foreign Appetite For U.S. Securities Has Taken a Drubbing

``When the Federal Reserve hiked benchmark rates in December, the initial jump in the short-end of the nominal U.S. yield curve raised expectations that foreign buyers would snap up the country's assets, thanks to their yield relative to those of other developed markets ravaged by low policy rates.  In fact, net foreign flows to the U.S. have been decidedly weak this year, thanks to an exodus by foreign central banks and sovereign wealth funds, who've been dumping U.S. securities in order to raise cash to put to work at home. In May, official institutions abroad raced out of U.S. stocks and bonds with $26 billion of outflows... Official institutions overseas -- led by central banks and sovereign wealth funds in China and the Middle East -- have been dumping U.S. Treasuries and stocks over the past year to support their currencies and stem capital outflows. ''