Housing agency faces $16.3B losses

A report shows a federal agency that insures mortgages for millions of low- and middle-income borrowers is facing losses of $16.3 billion and may require taxpayer support.

An annual independent audit of the Federal Housing Administration released Friday estimated losses that were steeper than earlier projections. That suggests the high number of mortgage defaults triggered by the housing crisis has reduced the FHA’s reserve funds.

The Department of Housing and Urban Development, which oversees the FHA, stressed the agency has sufficient cash to pay insurance claims against mortgage defaults.

Still, HUD said the Obama administration will consider seeking taxpayer assistance for the agency. That will be decided early next year when the administration puts together its budget request for fiscal 2014.

The Treasury Department says total foreign holdings rose to $5.46 trillion in September, up 0.1 percent from August.

China, the largest holder of U. S. government debt, barely increased its holdings in September to $1.16 trillion.

Japan, the second-largest holder, increased its holdings to $1.13 trillion. Brazil trimmed its holdings to $267 billion.

Investors continued to buy U. S. Treasurys, even as lawmakers and President Barack Obama remained at odds over whether to raise the U.S. borrowing limit. been unchanged without the storm, the Fed said. Utility output dipped 0.1 percent.