BRICS Nations Drive 19% Decline in Foreign Purchases of US Bonds and Treasuries

Global demand for US dollar-denominated bonds and Treasuries has plummeted by 19% in 2025, marking the first significant downturn in three years. BRICS members, European economies, and Asian nations are pivoting toward local-currency financial instruments, with developing countries’ sovereign debt issuance hitting a five-year high of $326 billion.

The retreat from US debt instruments reflects a broader shift in capital allocation strategies. Dealogic data reveals an $86.2 billion reduction in foreign purchases during the first five months of 2025 compared to 2024, as trade tensions and yield differentials reshape investment flows. Emerging markets are increasingly channeling funds into domestic assets, undermining the traditional dominance of dollar-based securities.