U.S. International Investment Position

First Quarter 2021, Annual Update, and Year 2020 (Revised)

By Erin Whitaker  |  Volume 101, Number 7  |  July 21, 2021

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This article presents the U.S. international investment position (IIP) statistics for the first quarter of 2021, the annual update of the IIP Accounts, and new detail for 2020. The new annual statistical detail for 2020 includes changes in position resulting from financial transactions and other changes in position such as price changes, exchange-rate changes, and changes in volume and valuation n.i.e. (not included elsewhere). With this year's annual update, the Bureau of Economic Analysis (BEA) has incorporated newly available and revised source data for 2017–2020.

The U.S. net international investment position—the difference between U.S. residents' foreign financial assets and liabilities—was −$14.32 trillion at the end of the first quarter of 2021 (chart 1). Assets totaled $32.81 trillion and liabilities were $47.13 trillion. At the end of the fourth quarter of 2020, the net investment position was −$14.01 trillion.

The U.S. international investment position is a statistical balance sheet that presents the dollar value of U.S. external financial assets and liabilities. A negative net investment position represents a U.S. net liability to the rest of the world.

The −$309.0 billion change in the net investment position from the fourth quarter of 2020 to the first quarter of 2021 came from net financial transactions of −$154.4 billion and net other changes in position, such as price and exchange-rate changes, of −$154.6 billion (table A).

Chart 1. U.S. Net International Investment Position, line chart

[Click chart to expand]

 

 

Table A. Quarterly Change in the U.S. Net International Investment Position
[Billions of dollars, not seasonally adjusted]
Type of investment End of quarter position, 2020:Q4 Change in position in 2021:Q1 End of quarter position, 2021:Q1
Total Attributable to:
Financial transactions Other changes in position1
U.S. net international investment position −14,011.2 −309.0 −154.4 −154.6 −14,320.3
Net position excluding financial derivatives −14,004.6 −349.2 −152.1 −197.1 −14,353.8
Financial derivatives other than reserves, net2 −6.6 40.2 −2.3 42.5 33.5
U.S. assets 32,256.3 555.5 (2) (2) 32,811.8
Assets excluding financial derivatives 29,710.6 942.4 402.7 539.8 30,653.0
Financial derivatives other than reserves 2,545.7 −386.9 (2) (2) 2,158.8
By functional category:          
Direct investment at market value 9,405.1 484.7 84.7 400.1 9,889.9
Equity 8,176.6 495.1 95.7 399.4 8,671.8
Debt instruments 1,228.5 −10.4 −11.0 0.6 1,218.1
Portfolio investment 14,605.6 528.3 304.7 223.6 15,133.9
Equity and investment fund shares 10,535.9 467.2 86.3 380.8 11,003.1
Debt securities 4,069.7 61.1 218.4 −157.2 4,130.8
Short term 720.4 33.9 38.8 −4.8 754.4
Long term 3,349.3 27.2 179.6 −152.4 3,376.5
Financial derivatives other than reserves 2,545.7 −386.9 (2) (2) 2,158.8
Over-the-counter contracts 2,491.4 −392.9 (2) (2) 2,098.4
Single-currency interest rate contracts 1,914.0 −389.2 (2) (2) 1,524.8
Foreign exchange contracts 372.1 −14.3 (2) (2) 357.9
Other contracts 205.3 10.5 (2) (2) 215.8
Exchange-traded contracts 54.4 6.0 (2) (2) 60.4
Other investment 5,072.6 −13.4 15.4 −28.8 5,059.2
Other equity 69.9 1.2 1.2 0.0 71.1
Currency and deposits 2,190.5 −29.1 −10.8 −18.3 2,161.4
Loans 2,766.7 10.7 21.1 −10.4 2,777.4
Insurance technical reserves n.a. n.a. n.a. n.a. n.a.
Trade credit and advances 45.6 3.8 3.9 −0.1 49.3
Reserve assets 627.3 −57.2 −2.1 −55.1 570.1
Monetary gold 493.6 −51.4 0.0 −51.4 442.2
Special drawing rights 52.9 −0.8 (*) −0.8 52.1
Reserve position in the International Monetary Fund 36.4 −2.7 −2.2 −0.6 33.7
Other reserve assets 44.4 −2.3 0.1 −2.3 42.1
U.S. liabilities 46,267.6 864.5 (2) (2) 47,132.1
Liabilities excluding financial derivatives 43,715.2 1,291.6 554.7 736.9 45,006.8
Financial derivatives other than reserves 2,552.4 −427.1 (2) (2) 2,125.3
By functional category:          
Direct investment at market value 11,977.9 593.7 64.3 529.4 12,571.6
Equity 10,262.0 609.2 67.8 541.4 10,871.2
Debt instruments 1,715.9 −15.5 −3.5 −12.0 1,700.4
Portfolio investment 24,628.4 552.2 326.5 225.7 25,180.6
Equity and investment fund shares 11,605.6 770.4 99.6 670.8 12,376.0
Debt securities 13,022.8 −218.2 226.9 −445.1 12,804.6
Short term 1,216.2 −45.0 −44.4 −0.5 1,171.2
Long term 11,806.6 −173.2 271.3 −444.5 11,633.4
Financial derivatives other than reserves 2,552.4 −427.1 (2) (2) 2,125.3
Over-the-counter contracts 2,500.9 −432.1 (2) (2) 2,068.7
Single-currency interest rate contracts 1,902.2 −402.2 (2) (2) 1,500.0
Foreign exchange contracts 386.2 −45.8 (2) (2) 340.4
Other contracts 212.4 15.9 (2) (2) 228.3
Exchange-traded contracts 51.5 5.1 (2) (2) 56.6
Other investment 7,108.9 145.7 163.9 −18.2 7,254.6
Other equity n.a. n.a. n.a. n.a. n.a.
Currency and deposits 3,804.2 89.4 93.9 −4.5 3,893.6
Loans 3,037.7 52.3 65.0 −12.8 3,090.0
Insurance technical reserves n.a. n.a. n.a. n.a. n.a.
Trade credit and advances 216.2 4.8 4.9 −0.1 221.0
Special drawing rights allocations 50.9 −0.8 0.0 −0.8 50.1
n.a.
Not available
(*)
Value between zero and +/− $50 million
  1. Disaggregation of other changes in position into price changes, exchange-rate changes, and other changes in volume and valuation is presented for annual statistics (see table C).
  2. Financial transactions and other changes in financial derivatives positions are available on a net basis; they are not separately available for U.S. assets and U.S. liabilities.

Note. The statistics on positions are presented in table 1.2 of the International Investment Position Accounts on BEA's website. The statistics on financial transactions are not seasonally adjusted and are presented in table 1.2 of the International Transactions Accounts on BEA's website.

U.S. assets increased by $555.5 billion to a total of $32.81 trillion at the end of the first quarter, mainly reflecting increases in portfolio investment and direct investment assets that were partly offset by decreases in financial derivatives (chart 2). Portfolio investment assets increased by $528.3 billion to $15.13 trillion, driven mainly by foreign stock price increases and strong U.S. net purchases of foreign securities; these increases were partly offset by the depreciation of many major foreign currencies against the U.S. dollar and by foreign bond price decreases. Direct investment assets increased by $484.7 billion to $9.89 trillion, driven by foreign stock price increases that were partly offset by the depreciation of many major foreign currencies against the U.S. dollar. Financial derivatives decreased by $386.9 billion to $2.16 trillion, mostly reflecting decreases in single-currency interest-rate contracts.

Both financial transactions and other changes in position contributed to the overall increase in U.S. assets (table A).

Chart 2. U.S. Assets, line chart

[Click chart to expand]

U.S. liabilities increased by $864.5 billion to a total of $47.13 trillion at the end of the first quarter, mainly reflecting increases in direct investment and portfolio investment liabilities that were partly offset by decreases in financial derivatives (chart 3). Direct investment liabilities increased by $593.7 billion to $12.57 trillion, driven by U.S. stock price increases. Portfolio investment liabilities increased by $552.2 billion to $25.18 trillion, driven by foreign net purchases of U.S. securities and U.S. stock price increases that were partly offset by U.S. bond price decreases. Financial derivatives decreased by $427.1 billion to $2.13 trillion, mostly reflecting decreases in single-currency interest-rate contracts.

Both financial transactions and other changes in position contributed to the overall increase in U.S. liabilities (table A).

Chart 3. U.S. Liabilities, line chart

[Click chart to expand]

The U.S. net international investment position statistics for 2017–2020 have been updated to incorporate newly available and revised source data. Key changes to the statistics are highlighted below, and the results are shown in table B.

  • Revised statistics for direct investment positions incorporate the results of BEA's 2017 Benchmark Survey of Foreign Direct Investment in the United States.
  • Revised statistics for portfolio investment positions incorporate the results of the U.S. Department of the Treasury's annual surveys “U.S. Ownership of Foreign Securities, including Selected Money Market Instruments” as of December 2019 and “Foreign-Residents' Holdings of U.S. Securities, including Selected Money Market Instruments” as of June 2020.
  • Revised statistics for financial derivatives and other investment positions (other equity, currency and deposits, loans, insurance technical reserves, and trade credit and advances) reflect revised source data mainly from the U.S. Department of the Treasury's Treasury International Capital surveys.

For information about revisions to financial transactions that impacted the IIP, see “Annual Update of the U.S. International Transactions Accounts” in this issue of the Survey of Current Business.

Table B. Updates to the U.S. Net International Investment Position at Yearend, 2017–2020
[Billions of dollars]
Type of investment 2017 2018 2019 2020
Previously published Revised Amount of revision Previously published Revised Amount of revision Previously published Revised Amount of revision Previously published Revised Amount of revision
U.S. net international investment position −7,622.2 −7,673.0 −50.8 −9,674.4 −9,684.7 −10.2 −11,050.5 −11,231.4 −180.9 −14,092.1 −14,011.2 80.9
Net position excluding financial derivatives −7,659.9 −7,710.6 −50.8 −9,716.5 −9,726.7 −10.2 −11,070.7 −11,251.6 −180.9 −14,085.5 −14,004.6 80.9
Financial derivatives other than reserves, net 37.6 37.6 0.0 42.0 42.0 0.0 20.2 20.2 0.0 −6.6 −6.6 0.0
U.S. assets 27,772.3 27,739.8 −32.5 25,233.8 25,217.9 −15.9 29,152.8 29,108.3 −44.5 32,156.0 32,256.3 100.3
Direct investment at market value 8,923.1 8,893.9 −29.1 7,443.9 7,417.4 −26.6 8,798.7 8,702.2 −96.4 9,295.6 9,405.1 109.6
Portfolio investment 12,571.5 12,571.5 0.0 11,433.6 11,433.6 0.0 13,375.9 13,366.2 −9.7 14,672.6 14,605.6 −67.0
Financial derivatives other than reserves 1,560.8 1,560.8 0.0 1,449.6 1,449.6 0.0 1,790.4 1,790.4 0.0 2,545.7 2,545.7 0.0
Other investment 4,267.3 4,263.9 −3.4 4,457.6 4,468.3 10.7 4,673.4 4,735.0 61.6 5,014.8 5,072.6 57.8
Reserve assets 449.7 449.7 0.0 449.1 449.1 0.0 514.4 514.4 0.0 627.3 627.3 0.0
U.S. liabilities 35,394.5 35,412.8 18.3 34,908.2 34,902.6 −5.6 40,203.3 40,339.7 136.4 46,248.1 46,267.6 19.5
Direct investment at market value 8,814.8 8,835.3 20.4 8,401.7 8,393.5 −8.2 10,547.1 10,486.0 −61.1 11,969.7 11,977.9 8.2
Portfolio investment 19,398.3 19,398.3 0.0 18,844.2 18,844.2 0.0 21,389.8 21,565.5 175.7 24,666.4 24,628.4 −38.0
Financial derivatives other than reserves 1,523.2 1,523.2 0.0 1,407.5 1,407.5 0.0 1,770.3 1,770.3 0.0 2,552.4 2,552.4 0.0
Other investment 5,658.3 5,656.1 −2.2 6,254.8 6,257.4 2.5 6,496.2 6,517.9 21.8 7,059.6 7,108.9 49.3

The U.S. net international investment position was −$14.01 trillion at the end of 2020, compared with −$11.23 trillion at the end of 2019 (table C). The −$2.78 trillion change in the net investment position from the end of 2019 to the end of 2020 came from net financial transactions of −$653.0 billion and net other changes in position, such as price and exchange rate changes, of −$2.13 trillion (table C).

U.S. assets increased by $3.15 trillion to a total of $32.26 trillion at the end of 2020, reflecting increases in all major categories of assets, particularly in portfolio investment, financial derivatives, and direct investment assets. Portfolio investment assets increased by $1.24 trillion to $14.61 trillion and direct investment assets increased by $702.9 billion to $9.41 trillion, driven mainly by the appreciation of major foreign currencies against the U.S. dollar that raised the value of U.S. assets in dollar terms and, to a lesser extent, by financial transactions. Financial derivatives increased by $755.3 billion to $2.55 trillion, mostly reflecting increases in single-currency interest-rate contracts.

Both financial transactions and other changes in position contributed to the overall increase in U.S. assets (table C).

U.S. liabilities increased by $5.93 trillion to a total of $46.27 trillion at the end of 2020, reflecting increases in all major categories of liabilities, particularly in portfolio investment, direct investment, and financial derivatives liabilities. Portfolio investment liabilities increased by $3.06 trillion to $24.63 trillion and direct investment liabilities increased by $1.49 trillion to $11.98 trillion, driven mainly by U.S. stock price increases and, to a lesser extent, by financial transactions. Financial derivatives increased by $782.1 billion to $2.55 trillion, mostly reflecting increases in single-currency interest-rate contracts.

Both financial transactions and other changes in position contributed to the overall increase in U.S. liabilities (table C).

Table C. Annual Change in the U.S. Net International Investment Position
[Billions of dollars]
Type of investment Yearend position, 2019 Change in position in 2020 Yearend position, 2020
Total Attributable to:
Financial transactions Other changes in position
Total Price changes Exchange-rate changes1 Changes in volume and valuation n.i.e.2
U.S. net international investment position −11,231.4 −2,779.8 −653.0 −2,126.8 (4) (4) (4) −14,011.2
Net position excluding financial derivatives −11,251.6 −2,753.0 −647.2 −2,105.8 −3,169.0 1,010.1 53.1 −14,004.6
Financial derivatives other than reserves, net3 20.2 −26.8 −5.8 −21.0 (4) (4) (4) −6.6
U.S. assets 29,108.3 3,148.1 (3) (3) (3) (3) (3) 32,256.3
Assets excluding financial derivatives 27,317.9 2,392.8 809.3 1,583.4 345.4 1,097.7 140.3 29,710.6
Financial derivatives other than reserves 1,790.4 755.3 (3) (3) (3) (3) (3) 2,545.7
By functional category:                
Direct investment at market value 8,702.2 702.9 311.7 391.2 −20.0 411.7 −0.5 9,405.1
Equity 7,449.1 727.5 330.9 396.6 −20.0 411.7 4.9 8,176.6
Debt instruments 1,253.1 −24.6 −19.2 −5.4 ….. ….. −5.4 1,228.5
Portfolio investment 13,366.2 1,239.4 220.0 1,019.3 267.9 626.6 124.9 14,605.6
Equity and investment fund shares 9,478.0 1,057.9 241.8 816.1 132.5 575.7 107.8 10,535.9
Debt securities 3,888.2 181.5 −21.8 203.2 135.4 50.8 17.0 4,069.7
Short term 765.0 −44.6 −53.8 9.2 ….. 5.9 3.3 720.4
Long term 3,123.2 226.1 32.0 194.1 135.4 45.0 13.7 3,349.3
Financial derivatives other than reserves 1,790.4 755.3 (3) (3) (3) (3) (3) 2,545.7
Over-the-counter contracts 1,755.3 736.1 (3) (3) (3) (3) (3) 2,491.4
Single-currency interest rate contracts 1,297.5 616.5 (3) (3) (3) (3) (3) 1,914.0
Foreign exchange contracts 288.1 84.0 (3) (3) (3) (3) (3) 372.1
Other contracts 169.7 35.6 (3) (3) (3) (3) (3) 205.3
Exchange-traded contracts 35.1 19.3 (3) (3) (3) (3) (3) 54.4
Other investment 4,735.0 337.6 268.6 69.0 0.0 53.1 15.9 5,072.6
Other equity 68.0 1.8 1.8 0.0 0.0 ….. 0.0 69.9
Currency and deposits 2,061.0 129.5 92.9 36.6 ….. 36.6 0.0 2,190.5
Loans 2,552.4 214.2 182.2 32.0 ….. 16.1 15.9 2,766.7
Insurance technical reserves n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.
Trade credit and advances 53.5 −8.0 −8.3 0.3 ….. 0.3 0.0 45.6
Reserve assets 514.4 112.9 9.0 103.9 97.5 6.4 0.0 627.3
Monetary gold 396.1 97.5 0.0 97.5 97.5 ….. 0.0 493.6
Special drawing rights 50.7 2.2 0.1 2.1 ….. 2.1 0.0 52.9
Reserve position in the International Monetary Fund 26.2 10.2 8.8 1.4 ….. 1.4 0.0 36.4
Other reserve assets 41.4 3.0 0.1 2.9 0.0 2.9 0.0 44.4
U.S. liabilities 40,339.7 5,927.9 (3) (3) (3) (3) (3) 46,267.6
Liabilities excluding financial derivatives 38,569.4 5,145.8 1,456.5 3,689.3 3,514.5 87.7 87.1 43,715.2
Financial derivatives other than reserves 1,770.3 782.1 (3) (3) (3) (3) (3) 2,552.4
By functional category:                
Direct investment at market value 10,486.0 1,491.8 211.3 1,280.5 1,314.1 ….. −33.6 11,977.9
Equity 8,774.6 1,487.4 198.3 1,289.1 1,314.1 ….. −25.0 10,262.0
Debt instruments 1,711.5 4.4 13.0 −8.6 ….. ….. −8.6 1,715.9
Portfolio investment 21,565.5 3,063.0 710.2 2,352.8 2,200.3 50.2 102.3 24,628.4
Equity and investment fund shares 9,220.4 2,385.3 648.4 1,736.9 1,641.3 ….. 95.6 11,605.6
Debt securities 12,345.1 677.7 61.8 615.9 559.0 50.2 6.7 13,022.8
Short term 945.1 271.1 272.5 −1.3 ….. −1.3 0.0 1,216.2
Long term 11,400.0 406.6 −210.7 617.3 559.0 51.5 6.7 11,806.6
Financial derivatives other than reserves 1,770.3 782.1 (3) (3) (3) (3) (3) 2,552.4
Over-the-counter contracts 1,738.0 762.9 (3) (3) (3) (3) (3) 2,500.9
Single-currency interest rate contracts 1,276.3 626.0 (3) (3) (3) (3) (3) 1,902.2
Foreign exchange contracts 296.1 90.1 (3) (3) (3) (3) (3) 386.2
Other contracts 165.7 46.8 (3) (3) (3) (3) (3) 212.4
Exchange-traded contracts 32.2 19.3 (3) (3) (3) (3) (3) 51.5
Other investment 6,517.9 591.0 535.1 55.9 ….. 37.5 18.4 7,108.9
Other equity n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.
Currency and deposits 3,467.8 336.5 323.6 12.9 ….. 7.5 5.4 3,804.2
Loans 2,795.1 242.6 198.9 43.7 ….. 27.8 16.0 3,037.7
Insurance technical reserves n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.
Trade credit and advances 206.3 9.9 12.6 −2.7 ….. 0.3 −3.0 216.2
Special drawing rights allocations 48.8 2.0 0.0 2.0 ….. 2.0 0.0 50.9
n.a.
Not available
.....
Not applicable
  1. Represents gains or losses on foreign-currency-denominated assets and liabilities due to their revaluation at current exchange rates.
  2. Changes in volume and valuation n.i.e. (not included elsewhere) includes changes due to year-to-year shifts in the composition of reporting panels and to the incorporation of more comprehensive survey results. Also includes capital gains and losses of direct investment affiliates and changes in positions that cannot be allocated to financial transactions, price changes, or exchange-rate changes.
  3. Financial transactions and other changes in financial derivatives positions are available on a net basis; they are not separately available for U.S. assets and U.S. liabilities.
  4. Data are not separately available for price changes, exchange-rate changes, and changes in volume and valuation n.i.e.

Note. The statistics are presented in table 1.3 of the International Investment Position Accounts on BEA's website.