U.S. International Investment Position, Fourth Quarter and Year 2020

The FINANCIAL — Fourth Quarter : The U.S. net international investment position, the difference between U.S. residents’ foreign financial assets and liabilities, was –$14.09 trillion at the end of the fourth quarter of 2020, according to statistics released by the U.S. Bureau of Economic Analysis (BEA). Assets totaled $32.16 trillion and liabilities were $46.25 trillion.

At the end of the third quarter, the net investment position was –$13.86 trillion

The –$227.5 billion change in the net investment position from the third quarter to the fourth quarter came from net financial transactions of –$287.1 billion and net other changes in position, such as price and exchange rate changes, of $59.6 billion

U.S. assets increased by $2.64 trillion, to a total of $32.16 trillion at the end of the fourth quarter, reflecting increases in all major categories of assets, particularly in portfolio investment and direct investment assets. Portfolio investment assets increased by $1.59 trillion, to $14.67 trillion, and direct investment assets increased by $955.5 billion, to $9.30 trillion, driven mainly by foreign stock price increases and, to a lesser extent, the appreciation of major foreign currencies against the U.S. dollar that raised the value of U.S. assets in dollar terms.

U.S. liabilities increased by $2.87 trillion, to a total of $46.25 trillion at the end of the fourth quarter, reflecting increases in all major categories of liabilities, particularly in portfolio investment and direct investment liabilities. Portfolio investment liabilities increased by $1.64 trillion, to $24.67 trillion, and direct investment liabilities increased by $1.12 trillion, to $11.97 trillion, driven mainly by U.S. stock price increases that raised the value of these liabilities.

The U.S. net international investment position was –$14.09 trillion at the end of 2020 compared to –$11.05 trillion at the end of 2019 (Table 1). 

The –$3.04 trillion change in the net investment position from the end of 2019 to the end of 2020 came from net financial transactions of –$743.6 billion and net other changes in position, such as price and exchange rate changes, of –$2.30 trillion (Table B).

U.S. assets increased by $3.00 trillion, to a total of $32.16 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 $1.30 trillion, to $14.67 trillion, and direct investment assets increased $496.9 billion, to $9.30 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 $755.3 billion, to $2.55 trillion, mostly reflecting increases in single-currency interest rate contracts.

Table A. Quarterly Change in the U.S. Net International Investment Position
Billions of dollars, not seasonally adjusted

U.S. liabilities increased by $6.04 trillion, to a total of $46.25 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 $3.28 trillion, to $24.67 trillion, and direct investment liabilities increased by $1.42 trillion, to $11.97 trillion, driven mainly by U.S. stock price increases and, to a lesser extent, financial transactions. Financial derivatives increased $782.1 billion, to $2.55 trillion, mostly reflecting increases in single-currency interest rate contracts.

The FINANCIAL — Fourth Quarter : The U.S. net international investment position, the difference between U.S. residents’ foreign financial assets and liabilities, was –$14.09 trillion at the end of the fourth quarter of 2020, according to statistics released by the U.S. Bureau of Economic Analysis (BEA). Assets totaled $32.16 trillion and liabilities were $46.25 trillion.

At the end of the third quarter, the net investment position was –$13.86 trillion

The –$227.5 billion change in the net investment position from the third quarter to the fourth quarter came from net financial transactions of –$287.1 billion and net other changes in position, such as price and exchange rate changes, of $59.6 billion

U.S. assets increased by $2.64 trillion, to a total of $32.16 trillion at the end of the fourth quarter, reflecting increases in all major categories of assets, particularly in portfolio investment and direct investment assets. Portfolio investment assets increased by $1.59 trillion, to $14.67 trillion, and direct investment assets increased by $955.5 billion, to $9.30 trillion, driven mainly by foreign stock price increases and, to a lesser extent, the appreciation of major foreign currencies against the U.S. dollar that raised the value of U.S. assets in dollar terms.

U.S. liabilities increased by $2.87 trillion, to a total of $46.25 trillion at the end of the fourth quarter, reflecting increases in all major categories of liabilities, particularly in portfolio investment and direct investment liabilities. Portfolio investment liabilities increased by $1.64 trillion, to $24.67 trillion, and direct investment liabilities increased by $1.12 trillion, to $11.97 trillion, driven mainly by U.S. stock price increases that raised the value of these liabilities.

The U.S. net international investment position was –$14.09 trillion at the end of 2020 compared to –$11.05 trillion at the end of 2019 (Table 1). 

The –$3.04 trillion change in the net investment position from the end of 2019 to the end of 2020 came from net financial transactions of –$743.6 billion and net other changes in position, such as price and exchange rate changes, of –$2.30 trillion (Table B).

U.S. assets increased by $3.00 trillion, to a total of $32.16 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 $1.30 trillion, to $14.67 trillion, and direct investment assets increased $496.9 billion, to $9.30 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 $755.3 billion, to $2.55 trillion, mostly reflecting increases in single-currency interest rate contracts.

Table A. Quarterly Change in the U.S. Net International Investment Position
Billions of dollars, not seasonally adjusted

U.S. liabilities increased by $6.04 trillion, to a total of $46.25 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 $3.28 trillion, to $24.67 trillion, and direct investment liabilities increased by $1.42 trillion, to $11.97 trillion, driven mainly by U.S. stock price increases and, to a lesser extent, financial transactions. Financial derivatives increased $782.1 billion, to $2.55 trillion, mostly reflecting increases in single-currency interest rate contracts.