treasuries

Stocks gained for a third day and commodities rallied, with copper snapping a seven-day slump, on optimism European leaders will solve the region’s debt crisis.

Treasuries and bunds declined.

Some economists doubt that the Federal Reserve’s expected resumption of buying Treasuries will have a big effect.

The government says that foreign demand for U.S. Treasury securities fell by the largest amount on record in December with China reducing its holdings by $34.2 billion.

The growth in Asia’s appetite for U.S. Treasuries is slowing, which means the United States may have to find others to finance its debt.

Solid demand at a Treasury auction eased fears that the appetite for U.S. debt would dry up and force the government to pay higher interest rates.

The Chinese government’s preference for Treasuries, and its loosening of laws on private investments, are changing the financial relationship between China and America.

The government is digging itself deeper into debt, but the market for Treasuries is not infinite and interest payments are expected to balloon.

Reversing its role as the world’s fastest-growing buyer of U.S. Treasuries and other foreign bonds, the Chinese government sold bonds heavily this winter.

The Chinese premier Wen Jiabao expressed concern on Friday about China’s $1 trillion investment in U.S. government debt.

China, the biggest holder of U.S. government debt, expressed concern about the safety of those assets.