A Look at the U.S. International Investment Position
Second Quarter of 2024
The U.S. Bureau of Economic Analysis (BEA) recently released statistics on the U.S. international investment position for the second quarter of 2024. The U.S. international investment position (IIP) is a statistical balance sheet that presents the dollar value of U.S. external financial assets and liabilities. The U.S. net IIP is the difference between U.S. residents’ foreign financial assets and liabilities. A negative net investment position represents a U.S. net liability to the rest of the world.
The following charts present highlights of the U.S. IIP statistics for the second quarter. More detail can be found on the U.S. international investment position product page on BEA’s website.
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- The U.S. net IIP decreased to −$22.52 trillion at the end of the second quarter of 2024 from −$21.29 trillion at the end of the first quarter.
- The $1.23 trillion decrease in the net IIP reflected an increase in liabilities that exceeded an increase in assets.
- U.S. assets increased by $173.2 billion to a total of $36.00 trillion at the end of the second quarter, driven mainly by increases in financial derivatives.
- U.S. liabilities increased by $1.40 trillion to a total of $58.52 trillion at the end of the second quarter, driven mainly by U.S. stock price increases that raised the market value of portfolio investment and direct investment liabilities.
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- Financial derivatives increased by $112.8 billion to $2.28 trillion, mostly reflecting an increase in single-currency interest rate contracts.
- Portfolio investment assets and direct investment assets (the largest categories of assets) changed little in the second quarter, as financial transactions and price changes were mostly offset by exchange rate changes (chart 3).
- Portfolio investment assets increased by $53.1 billion to $16.05 trillion, and direct investment assets decreased by $1.3 billion to $11.32 trillion.
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- Financial transactions (mostly reflecting net U.S. purchases of foreign long-term debt securities and increases in direct investment equity assets) raised assets by $161.8 billion.
- Price changes (mostly reflecting foreign stock price increases) raised the value of U.S. assets by $159.0 billion.
- In contrast, exchange-rate changes lowered the value of assets by $236.0 billion.
- Financial transactions and foreign stock price increases were mostly offset by foreign currency depreciation against the U.S. dollar that lowered the value of foreign-currency-denominated assets in dollar terms.
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- Portfolio investment liabilities increased by $666.4 billion to $30.89 trillion, and direct investment liabilities increased by $568.2 billion to $16.64 trillion.
- These increases were driven mainly by U.S. stock price increases that raised the market value of portfolio investment and direct investment liabilities by $380.0 billion and $475.3 billion, respectively.
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- Price changes (mostly reflecting U.S. stock price increases) raised the value of U.S. liabilities by $775.9 billion.
- Financial transactions (mostly reflecting foreign purchases of U.S. stocks and long-term debt securities) raised U.S. liabilities by $391.1 billion.
