Market Chatter: Foreign Central Banks Cut US Treasury Holdings to Lowest Since 2012 Amid Iran War

02:16 PM EDT, 03/31/2026 (MT Newswires) -- Foreign central banks have reduced their holdings of US Treasuries held at the New York Federal Reserve to the lowest level since 2012 due to the ongoing Iran war, the Financial Times reported Tuesday, citing Fed data.

Treasuries held at the New York Fed by official institutions, including central banks, governments, and international organizations, have fallen by $82 billion since Feb. 25 to $2.7 trillion, Fed data showed, according to the report.

The decline since the Iran war began reflects rising energy prices after the closure of the Strait of Hormuz, which has strained oil-importing countries and boosted the US dollar, the report said.

Analysts said oil importers such as Turkey, India, and Thailand are likely among those selling Treasuries to cover higher dollar-denominated oil costs, while some Middle Eastern oil exporters may also be selling, though they make up a smaller share of overall Treasury holders, the report added.

The New York Federal Reserve didn't immediately reply to MT Newswires' request for comment.

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