Democratic Underground - Not worrying if investors look overseas-US Treasury

http://today.reuters.com/misc/PrinterFriendlyPopup.aspx?type=bondsNews&storyID=uri:2006-03-09T192438Z_01_N09390046_RTRIDST_0_ECONOMY-QUARLES-INVESTORS-INTERVIEW-UPDATE-1.XML

WASHINGTON, March 9 (Reuters) - It is too soon to say if an increase in U.S. bond yields in recent weeks means investors are showing a growing preference for overseas markets, but it would not be troubling if so, a senior U.S. Treasury official said on Thursday.

"I think it would be premature to draw that conclusion yet," Treasury Undersecretary for Domestic Finance Randal Quarles said in an interview with Reuters.

Quarles said, however, it would not be a surprise if investors were increasingly looking elsewhere for opportunities, given signs of quickening growth in other economies, particularly Japan.

As growth accelerates in other countries "then an investor considering where to put the marginal investment dollar, it's going to now be more likely than it was yesterday that he is going to consider an alternative to the United States."

But he said shifting investor preferences were unlikely to hit the U.S. economy hard.

"I don't think that the U.S. economy generally, or the financing of the U.S. economy, has anything to fear from those sorts of decisions by various economic actors in light of changing economic circumstances," Quarles said.

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