International Financial Law Prof Blog

Editor: William Byrnes
Texas A&M University
School of Law

Thursday, January 4, 2018

U.S. Net International Investment Position Third Quarter 2017

The U.S. net international investment position increased to -$7,768.7 billion (preliminary) at the end of the third quarter of 2017 from -$8,004.1 billion (revised) at the end of the second quarter, according to statistics released today by the Bureau of Economic Analysis (BEA). The $235.4 billion increase reflected a $1,001.2 billion increase in U.S. assets and a $765.8 billion increase in U.S. liabilities (table 1).

The $235.4 billion increase in the net investment position reflected net financial transactions of –$87.4 billion and net other changes in position, such as price and exchange-rate changes, of $322.8 billion (table A).

The net investment position increased 2.9 percent in the third quarter, compared with an increase of 1.1 percent in the second quarter, and an average quarterly decrease of 5.3 percent from the first quarter of 2011 through the first quarter of 2017.

U.S. assets increased $1,001.2 billion to $26,854.9 billion at the end of the third quarter, mostly reflecting increases in portfolio investment and direct investment assets that were partly offset by a decrease in financial derivatives.

  • Assets excluding financial derivatives increased $1,227.5 billion to $25,149.7 billion. The increase resulted from other changes in position of $869.2 billion and financial transactions of $358.2 billion (table A). Other changes in position mostly reflected foreign equity price increases that raised the equity value of portfolio investment and direct investment assets, and the appreciation of major foreign currencies against the U.S. dollar that raised the value of foreign-currency-denominated assets in dollar terms. Financial transactions mostly reflected net acquisition of portfolio investment assets.
  • Financial derivatives decreased $226.2 billion to $1,705.1 billion, mostly in single-currency interest rate contracts.
Table A. Quarterly Change in the U.S. Net International Investment PositionBillions of dollars, not seasonally adjusted
  Position, 2017:II Change in position in 2017:III Position, 2017:III
Total Attributable to:
Financial transactions Other changes in position 1
U.S. net international investment position -8,004.1 235.4 -87.4 322.8 -7,768.7
Net position excluding financial derivatives -8,041.2 238.7 -106.0 344.7 -7,802.5
Financial derivatives other than reserves, net 37.1 -3.3 18.6 -21.9 33.8
U.S. assets 25,853.6 1,001.2 (2) (2) 26,854.9
Assets excluding financial derivatives 23,922.3 1,227.5 358.2 869.2 25,149.7
Financial derivatives other than reserves 1,931.3 -226.2 (2) (2) 1,705.1
U.S. liabilities 33,857.8 765.8 (2) (2) 34,623.6
Liabilities excluding financial derivatives 31,963.5 988.8 464.2 524.6 32,952.3
Financial derivatives other than reserves 1,894.3 -223.0 (2) (2) 1,671.3
1 Disaggregation of other changes in position into price changes, exchange-rate changes, and other changes in volume and valuation is only presented for annual statistics released in June each year.
2 Financial transactions and other changes in financial derivatives positions are available only on a net basis; they are not separately available for U.S. assets and U.S. liabilities.

U.S. liabilities increased $765.8 billion to $34,623.6 billion at the end of the third quarter, mostly reflecting increases in portfolio investment and direct investment liabilities that were partly offset by a decrease in financial derivatives.

  • Liabilities excluding financial derivatives increased $988.8 billion to $32,952.3 billion. The increase resulted from other changes in position of $524.6 billion and financial transactions of $464.2 billion (table A). Other changes in position mostly reflected U.S. equity price increases that raised the equity value of portfolio investment and direct investment liabilities. Financial transactions mostly reflected net incurrence of portfolio investment liabilities.
  • Financial derivatives decreased $223.0 billion to $1,671.3 billion, mostly in single-currency interest rate contracts.
Updates to Second Quarter 2017 International Investment Position AggregatesBillions of dollars, not seasonally adjusted
  Preliminary estimate Revised estimate
U.S. net international investment position -7,934.9 -8,004.1
  U.S. assets 25,937.6 25,853.6
    Direct investment at market value 8,202.0 8,125.2
    Portfolio investment 11,210.6 11,206.8
    Financial derivatives other than reserves 1,931.3 1,931.3
    Other investment 4,157.9 4,154.6
    Reserve assets 435.7 435.7
  U.S. liabilities 33,872.5 33,857.8
    Direct investment at market value 8,162.1 8,134.5
    Portfolio investment 18,451.0 18,462.6
    Financial derivatives other than reserves 1,894.3 1,894.3
    Other investment 5,365.1 5,366.3

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