Where Have All the Foreign Buyers Gone for U.S. Treasury Debt?

Foreigners no longer have an insatiable appetite for U.S. government debt. That’s bad news for Washington.

The U.S. Treasury market is in the midst of major supply and demand changes. The Federal Reserve is shedding its portfolio at a rate of about $60 billion a month. Overseas buyers who were once important sources of demand—China and Japan in particular—have become less reliable lately.