Foreign demand for long-term U.S. financial assets jumped sharply in November, rising to the highest level in more than two years even though China's holdings of Treasury securities fell.

Continued strong demand for U.S. debt is critical to financing America's soaring budget deficits and keeping domestic interest rates low enough to support a sustained economic recovery.

The Treasury Department said foreigners purchased $126.8 billion more in assets than they sold in November, the largest gain since an increase of $128.9 billion in October 2007.