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EMBARGOED UNTIL RELEASE AT 8:30 A.M. EDT, FRIDAY, MARCH 30, 2018 Technical: Media: Christopher Gohrband Doug Weinberg Jeannine Aversa (301) 278-9564 (301) 278-9590 (301) 278-9003 BEA 18-16 Christopher.Gohrband@bea.gov Douglas.Weinberg@bea.gov Jeannine.Aversa@bea.gov U.S. Net International Investment Position Fourth Quarter and Year 2017 Fourth Quarter 2017 The U.S. net international investment position decreased to −$7,845.8 billion (preliminary) at the end of the fourth quarter from −$7,739.7 billion (revised) at the end of the third quarter, according to statistics released by the Bureau of Economic Analysis (BEA). The $106.1 billion decrease reflected a $727.2 billion increase in U.S. assets and an $833.3 billion increase in U.S. liabilities (table 1). U.S. Net International Investment Position Billion $ 0 -1,000 -2,000 -3,000 -4,000 -5,000 Quarterly series (not seasonally adjusted) -6,000 Annual series -7,000 -8,000 -9,000 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 U.S. Bureau of Economic Analysis The $106.1 billion decrease in the net investment position reflected net financial transactions of –$52.4 billion and net other changes in position, such as price and exchange-rate changes, of –$53.8 billion (table A). The net investment position decreased 1.4 percent in the fourth quarter, compared with an increase of 3.3 percent in the third quarter. The net investment position decreased an average of 5.0 percent per quarter from the first quarter of 2011 through the second quarter of 2017. U.S. assets increased $727.2 billion to $27,632.8 billion at the end of the fourth quarter, mostly reflecting increases in portfolio investment and direct investment assets. • Assets excluding financial derivatives increased $809.8 billion to $26,010.4 billion. The increase resulted from other changes in position of $658.8 billion and financial transactions of $151.0 billion (table A). Other changes in position mostly reflected (1) foreign equity price increases that raised the value of portfolio investment and direct investment equity assets and (2) the appreciation of major foreign currencies against the U.S. dollar that raised the value of foreigncurrency-denominated assets in dollar terms. Financial transactions mostly reflected net acquisition of portfolio investment debt securities and direct investment equity assets. • Financial derivatives decreased $82.6 billion to $1,622.5 billion, mostly in single-currency interest rate contracts and foreign exchange contracts. Table A. Quarterly Change in the U.S. Net International Investment Position Billions of dollars, not seasonally adjusted Position, 2017:III U.S. net international investment position -7,739.7 Net position excluding financial derivatives -7,773.5 Financial derivatives other than reserves, net 33.8 U.S. assets 26,905.6 Assets excluding financial derivatives 25,200.5 Financial derivatives other than reserves 1,705.1 U.S. liabilities Liabilities excluding financial derivatives Financial derivatives other than reserves 34,645.3 32,974.0 1,671.3 Change in position in 2017:IV Attributable to: Other Total Financial changes transactions in position 1 -106.1 -52.4 -53.8 -100.6 -53.2 -47.5 -5.5 0.8 -6.3 2 727.2 () (2) 809.8 151.0 658.8 -82.6 (2) (2) 833.3 910.5 -77.1 (2) 204.2 (2) (2) 706.3 (2) Position, 2017:IV -7,845.8 -7,874.1 28.3 27,632.8 26,010.4 1,622.5 35,478.6 33,884.4 1,594.2 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 $833.3 billion to $35,478.6 billion at the end of the fourth quarter, mostly reflecting increases in portfolio investment and direct investment liabilities. • Liabilities excluding financial derivatives increased $910.5 billion to $33,884.4 billion. The increase resulted from other changes in position of $706.3 billion and financial transactions of $204.2 billion (table A). Other changes in position mostly reflected U.S. equity price increases that raised the value of portfolio investment and direct investment equity liabilities. Financial transactions reflected net incurrence of liabilities in all major investment categories. • Financial derivatives decreased $77.1 billion to $1,594.2 billion, mostly in single-currency interest rate contracts and foreign exchange contracts. –2– U.S. Assets and Liabilities Quarterly, not seasonally adjusted Billion $ 40,000 U.S. liabilities 35,000 30,000 U.S. assets 25,000 20,000 15,000 10,000 5,000 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 U.S. Bureau of Economic Analysis Updates to Statistics Table B. Updates to Third Quarter 2017 International Investment Position Aggregates Billions of dollars, not seasonally adjusted Preliminary estimate Revised estimate U.S. net international investment position -7,768.7 -7,739.7 U.S. assets 26,854.9 26,905.6 Direct investment at market value 8,580.6 8,595.4 Portfolio investment 11,860.1 11,905.5 Financial derivatives other than reserves 1,705.1 1,705.1 Other investment 4,252.5 4,243.0 Reserve assets 456.6 456.6 U.S. liabilities 34,623.6 34,645.3 Direct investment at market value 8,452.8 8,454.1 Portfolio investment 19,043.2 19,057.9 Financial derivatives other than reserves 1,671.3 1,671.3 Other investment 5,456.2 5,461.9 Year 2017 The U.S. net international investment position increased to −$7,845.8 billion (preliminary) at the end of 2017 from −$8,318.4 billion at the end of 2016. The $472.6 billion increase reflected a $3,783.4 billion increase in U.S. assets and a $3,310.8 billion increase in U.S. liabilities. U.S. assets increased $3,783.4 billion to $27,632.8 billion at the end of 2017, mostly reflecting increases in portfolio investment and direct investment assets that were partly offset by a decrease in financial derivatives. –3– • Assets excluding financial derivatives increased $4,369.9 billion to $26,010.4 billion. The increase resulted from other changes in position of $3,157.5 billion and financial transactions of $1,212.4 billion (table C). Other changes in position mostly reflected (1) foreign equity price increases that raised the value of portfolio investment and direct investment equity assets and (2) 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 reflected net acquisition of assets in all major investment categories, except reserve assets. • Financial derivatives decreased $586.5 billion to $1,622.5 billion, mostly in single-currency interest rate contracts and foreign exchange contracts. Table C. Annual Change in the U.S. Net International Investment Position Billions of dollars Position, 2016 U.S. net international investment position Net position excluding financial derivatives Financial derivatives other than reserves, net U.S. assets Assets excluding financial derivatives Financial derivatives other than reserve U.S. liabilities Liabilities excluding financial derivatives Financial derivatives other than reserves -8,318.4 -8,379.7 61.3 23,849.4 21,640.5 2,209.0 32,167.8 30,020.1 2,147.7 Change in position in 2017 Attributable to: Other Total Financial changes transactions in position 1 472.6 -349.2 821.8 505.6 -375.6 881.2 -33.0 26.4 -59.4 3,783.4 4,369.9 -586.5 3,310.8 3,864.3 -553.5 (2) 1,212.4 (2) (2) 1,587.9 (2) (2) 3,157.5 (2) (2) 2,276.4 (2) Position, 2017 -7,845.8 -7,874.1 28.3 27,632.8 26,010.4 1,622.5 35,478.6 33,884.4 1,594.2 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 $3,310.8 billion to $35,478.6 billion at the end of 2017, 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 $3,864.3 billion to $33,884.4 billion. The increase resulted from other changes in position of $2,276.4 billion and financial transactions of $1,587.9 billion (table C). Other changes in position mostly reflected U.S. equity price increases that raised the value of portfolio investment and direct investment equity liabilities. Financial transactions reflected net incurrence of liabilities in all major investment categories. • Financial derivatives decreased $553.5 billion to $1,594.2 billion, mostly in single-currency interest rate contracts and foreign exchange contracts. –4– Notice of Upcoming Update to the U.S. Net International Investment Position The annual update of the U.S. net international investment position will be released along with preliminary estimates for the first quarter of 2018 on June 27, 2018. An article previewing the annual update will appear in the May 2018 issue of the Survey of Current Business. Next release: June 27, 2018, at 8:30 A.M. EDT U.S. Net International Investment Position, First Quarter 2018, Year 2017, and Annual Update * * * U.S. Net International Investment Position Release Dates in 2018 Fourth Quarter and Year 2017 March 30 First Quarter 2018, Year 2017, and Annual Update June 27 Second Quarter 2018 September 26 Third Quarter 2018 December 27 –5– Additional Information Resources • • • • • • • Price changes (only presented for annual statistics in the June news release) are changes in the value of an asset or liability due to changes in the market price of a financial instrument. Stay informed about BEA developments by reading the BEA blog, signing up for BEA’s email subscription service, or following BEA on Twitter @BEA_News. Historical time series for these estimates can be accessed in BEA’s Interactive Data Application. Access BEA data by registering for BEA’s Data Application Programming Interface (API). For more on BEA’s statistics, see our monthly online journal, the Survey of Current Business. BEA's news release schedule. More information on these international investment position statistics will be provided next month in the Survey of Current Business. More information on the international investment position accounts and a description of the estimation methods used to compile them is provided in U.S. International Economic Accounts: Concepts and Methods . Exchange-rate changes (only presented for annual statistics in the June news release) are changes in the value of foreign-currency denominated assets and liabilities due to changes in the values of foreign currencies relative to the value of the U.S. dollar. Changes in volume and valuation n.i.e. (only presented for annual statistics in the June news release) reflect changes in position due to year-to-year shifts in the composition of reporting panels, the incorporation of more comprehensive annual and benchmark survey results, and revaluations (holding gains and losses) on assets and liabilities that are not explained by price changes or exchange-rate changes. Functional categories are the primary classification system used in the IIP and in the financial account of the ITAs. The five functional categories are direct investment, portfolio investment, financial derivatives other than reserves, other investment, and reserve assets. While the functional categories are based on features that are relevant for understanding cross-border financial transactions and positions, they also take into account some aspects of the relationship between transactors and the economic motivation for the investment. Within the functional categories, the IIP accounts are classified by type of financial instrument. Definitions The international investment position (IIP) is a statistical balance sheet that presents the dollar value of U.S. financial assets and liabilities with respect to foreign residents at a specific point in time. BEA presents IIP statistics at the end of a quarter or year (March, June, September, and December). For the June release, BEA also presents statistics on changes in the yearend position that are disaggregated into financial transactions, price changes, exchange-rate changes, and changes in volume and valuation not included elsewhere (n.i.e.). Financial transactions are transactions between U.S. residents and nonresidents in financial assets and liabilities. They are also recorded in the financial account of the international transactions accounts (ITAs). See Related Statistics below. Direct investment is a category of cross-border investment associated with a resident in one economy having control or a significant degree of influence on the management of an enterprise resident in another economy. Ownership or control of 10 percent or more of the voting securities of an entity in another economy is the threshold for separating direct investment from other types of investment. Direct investment positions include positions in equity and debt instruments. BEA’s IIP statistics feature the market value measure of direct investment positions, a measure that values owner’s equity at current-period prices using indexes of stock market prices. Other changes in position are changes in the value of U.S. assets or liabilities arising from any source besides a financial transaction. Other changes in position include price changes, exchange-rate changes, and changes in volume and valuation not included elsewhere (n.i.e.). Portfolio investment consists of cross-border positions involving equity and investment fund shares and debt securities, excluding those included in direct investmentor reserve assets. Debt securities are classified by original maturity (short term vs. long term at the time of issue). The U.S. net international investment position is defined as the value of U.S. assets less the value of U.S. liabilities. –6– Release and update schedule Financial derivatives other than reserves consist of crossborder positions arising from financial contracts that are linked to underlying financial instruments, commodities, or indicators. Positions in financial derivatives consist of contracts with positive and negative fair values. A contract with a positive fair value is a U.S. asset and represents the amount that a foreign resident would have to pay to a U.S. counterparty if the contract were terminated or settled. A contract with a negative fair value is a U.S. liability and represents the amount that a U.S. resident would have to pay to a foreign counterparty if the contract were terminated or settled. The gross positive (negative) fair value is the sum across all contracts with positive (negative) fair values. Fair values differ from notional values, which are the underlying amounts used to calculate payments on contracts. Gross positive and gross negative fair values for financial derivatives positions are available separately in table 1. However, transactions and other changes in financial derivatives positions are only available for the net position in financial derivatives. For other changes in position for financial derivatives presented in the June news release, statistics are not separately available for price changes, exchange-rate changes, and changes in volume and valuation n.i.e. Preliminary quarterly IIP account statistics are released in March, June, September, and December, approximately 90 days after the end of the reference quarter. These statistics are updated the following quarter to incorporate new and revised source data. Quarterly statistics are open for revision for at least the prior three years in annual updates released in June. Preliminary annual statistics are released in March reflecting positions at the end of the fourth quarter of the previous year. These annual statistics are open for revision for at least the prior three years in subsequent annual updates. Related statistics The IIP statistics comprise one part of a broader set of U.S. international economic accounts that, taken together, provide a comprehensive, integrated and detailed picture of U.S. international economic activities. The international transactions accounts (ITAs) are released quarterly. Financial transactions reported in the financial account of the ITAs are one type of change in position recorded in the IIP. Financial transactions are transactions between U.S. residents and nonresidents for direct investment, portfolio investment, other investment, reserve assets, and financial derivatives. Other investment includes cross-border positions other than those included in direct investment, portfolio investment, financial derivatives, and reserve assets. Other investment positions consist of positions in currency and deposits, loans, insurance technical reserves, trade credit and advances, and, for liabilities, special drawing rights allocations. Statistics on direct investment and multinational enterprises (MNEs) include annual statistics on the activities of MNEs, detailed annual and quarterly statistics on direct investment, and annual statistics on new investment in the United States. Reserve assets are those external assets that are readily available to and controlled by U.S. monetary authorities for meeting balance of payments financing needs, for intervention in exchange markets to affect the currency exchange rate, and for other related purposes such as maintaining confidence in the currency and the economy and serving as a basis for foreign borrowing. The major published components are monetary gold, International Monetary Fund (IMF) special drawing rights (SDRs), reserve position in the IMF, and other reserve assets. Statistics on international services include detailed annual information on trade in services and on services supplied through the channel of direct investment by affiliates of multinational enterprises. U.S. international trade in goods and services , released by BEA and the U.S. Census Bureau, provides monthly statistics on trade in goods and services . List of News Release Tables Table 1. U.S. Net International Investment Position at the End of the Period –7– March 30, 2018 Table 1. U.S. Net International Investment Position at the End of the Period [Billions of dollars, not seasonally adjusted] Line 2017 2016 Type of investment IV 1 U.S. net international investment position (line 4 less line 35)............................................. -8,318.4 2 Net international investment position excluding financial derivatives (line 5 less line 36)...... -8,379.7 3 Financial derivatives other than reserves, net (line 6 less line 37)......................................... 61.3 4 U.S. assets............................................................................................................................. 23,849.4 5 Assets excluding financial derivatives (sum of lines 7, 10, 21, and 26)............................... 21,640.5 6 Financial derivatives other than reserves, gross positive fair value (line 15)....................... 2,209.0 By functional category: 7 Direct investment at market value........................................................................................ 7,375.0 8 Equity................................................................................................................................ 6,172.3 9 Debt instruments................................................................................................................ 1,202.7 10 Portfolio investment............................................................................................................ 9,879.2 11 Equity and investment fund shares.................................................................................... 6,997.0 12 Debt securities................................................................................................................... 2,882.2 13 Short term........................................................................................................................ 462.3 14 Long term........................................................................................................................ 2,419.9 15 Financial derivatives other than reserves, gross positive fair value.................................... 2,209.0 16 Over-the-counter contracts................................................................................................ 2,166.9 17 Single-currency interest rate contracts............................................................................ 1,622.2 18 Foreign exchange contracts............................................................................................ 386.7 19 Other contracts................................................................................................................ 158.0 20 Exchange-traded contracts................................................................................................ 42.1 21 Other investment................................................................................................................. 3,978.9 22 Currency and deposits....................................................................................................... 1,559.8 23 Loans................................................................................................................................. 2,373.7 24 Insurance technical reserves............................................................................................. n.a. 25 Trade credit and advances................................................................................................ 45.4 26 Reserve assets................................................................................................................... 407.2 27 Monetary gold................................................................................................................... 301.1 28 Special drawing rights........................................................................................................ 48.9 29 Reserve position in the International Monetary Fund........................................................ 18.4 30 Other reserve assets......................................................................................................... 38.9 31 Currency and deposits..................................................................................................... 17.7 32 Securities......................................................................................................................... 21.1 33 Financial derivatives........................................................................................................ ….. 34 Other claims.................................................................................................................... 0.0 35 U.S. liabilities.......................................................................................................................... 32,167.8 36 Liabilities excluding financial derivatives (sum of lines 38, 41, and 56)............................... 30,020.1 37 Financial derivatives other than reserves, gross negative fair value (line 50)...................... 2,147.7 By functional category: 38 Direct investment at market value........................................................................................ 7,569.3 39 Equity................................................................................................................................ 5,783.5 40 Debt instruments................................................................................................................ 1,785.8 41 Portfolio investment............................................................................................................ 17,352.3 42 Equity and investment fund shares.................................................................................... 6,564.0 43 Debt securities................................................................................................................... 10,788.4 44 Short term........................................................................................................................ 945.9 45 Treasury bills and certificates........................................................................................ 672.4 46 Other short-term securities............................................................................................ 273.5 47 Long term........................................................................................................................ 9,842.5 48 Treasury bonds and notes............................................................................................. 5,333.9 49 Other long-term securities............................................................................................. 4,508.6 50 Financial derivatives other than reserves, gross negative fair value................................... 2,147.7 51 Over-the-counter contracts................................................................................................ 2,104.6 52 Single-currency interest rate contracts............................................................................ 1,568.1 53 Foreign exchange contracts............................................................................................ 366.8 54 Other contracts................................................................................................................ 169.6 55 Exchange-traded contracts................................................................................................ 43.1 56 Other investment................................................................................................................. 5,098.6 57 Currency and deposits....................................................................................................... 2,949.8 58 Loans................................................................................................................................. 1,925.8 59 Insurance technical reserves............................................................................................. n.a. 60 Trade credit and advances................................................................................................ 175.5 61 Special drawing rights allocations...................................................................................... 47.5 p Preliminary r Revised n.a. Not available ..... Not applicable Note: Details may not add to totals because of rounding. Source: U.S. Bureau of Economic Analysis –8– I II -8,091.6 -8,004.1 -8,133.3 -8,041.2 41.6 37.1 24,933.4 25,853.6 22,986.7 23,922.3 1,946.7 1,931.3 r p III IV -7,739.7 -7,845.8 -7,773.5 -7,874.1 33.8 28.3 26,905.6 27,632.8 25,200.5 26,010.4 1,705.1 1,622.5 Change: Change: 2017:III to 2016:IV to 2017:IV 2017:IV Line -106.1 -100.6 -5.5 727.2 809.8 -82.6 472.6 505.6 -33.0 3,783.4 4,369.9 -586.5 1 2 3 4 5 6 7,895.4 8,125.2 8,595.4 8,863.4 6,608.5 6,909.4 7,346.7 7,623.2 1,286.9 1,215.8 1,248.7 1,240.2 10,591.6 11,206.8 11,905.5 12,443.2 7,568.6 8,068.2 8,622.1 9,027.0 3,023.0 3,138.6 3,283.4 3,416.1 506.0 544.3 617.1 648.0 2,517.0 2,594.2 2,666.3 2,768.1 1,946.7 1,931.3 1,705.1 1,622.5 1,911.3 1,893.8 1,663.1 1,582.0 1,478.4 1,428.3 1,201.8 1,150.5 272.4 297.3 281.1 261.3 160.4 168.2 180.2 170.1 35.4 37.6 42.1 40.5 4,066.6 4,154.6 4,243.0 4,254.1 1,602.0 1,626.6 1,685.9 1,754.1 2,415.2 2,477.8 2,505.5 2,448.4 n.a. n.a. n.a. n.a. 49.3 50.2 51.7 51.6 433.1 435.7 456.6 449.7 325.5 324.8 343.9 337.6 49.3 50.6 51.4 51.9 18.3 18.8 19.0 17.6 39.9 41.4 42.2 42.6 20.2 22.6 25.3 25.6 19.7 18.7 16.9 17.0 ….. ….. ….. ….. 0.0 0.0 0.0 0.0 33,025.0 33,857.8 34,645.3 35,478.6 31,120.0 31,963.5 32,974.0 33,884.4 1,905.1 1,894.3 1,671.3 1,594.2 268.0 276.5 -8.5 537.7 405.0 132.7 30.9 101.8 -82.6 -81.1 -51.3 -19.7 -10.1 -1.5 11.1 68.3 -57.1 n.a. -0.1 -6.8 -6.3 0.4 -1.4 0.4 0.3 0.1 ….. 0.0 833.3 910.5 -77.1 1,488.3 1,450.8 37.5 2,563.9 2,030.0 533.9 185.6 348.2 -586.5 -585.0 -471.7 -125.3 12.1 -1.5 275.2 194.3 74.7 n.a. 6.2 42.5 36.5 3.0 -0.8 3.7 7.9 -4.2 ….. 0.0 3,310.8 3,864.3 -553.5 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 7,952.4 8,134.5 8,454.1 8,871.4 6,152.6 6,341.2 6,629.8 7,055.5 1,799.8 1,793.3 1,824.2 1,815.9 17,908.3 18,462.6 19,057.9 19,504.2 7,001.9 7,199.1 7,559.4 7,958.6 10,906.4 11,263.5 11,498.5 11,545.6 942.0 979.8 957.1 986.0 673.0 698.7 703.2 727.8 269.0 281.1 254.0 258.3 9,964.4 10,283.7 10,541.4 10,559.5 5,406.0 5,472.8 5,619.8 5,582.5 4,558.4 4,810.9 4,921.6 4,977.0 1,905.1 1,894.3 1,671.3 1,594.2 1,867.9 1,852.8 1,630.0 1,554.4 1,418.5 1,372.0 1,166.6 1,112.6 280.4 305.3 281.7 266.8 169.0 175.5 181.8 175.1 37.2 41.5 41.3 39.9 5,259.2 5,366.3 5,461.9 5,508.9 3,020.3 3,132.2 3,120.2 3,197.5 2,006.7 1,999.9 2,100.5 2,067.4 n.a. n.a. n.a. n.a. 184.2 185.0 191.4 193.7 47.9 49.1 49.9 50.3 417.3 425.7 -8.4 446.2 399.2 47.0 28.9 24.6 4.3 18.1 -37.3 55.4 -77.1 -75.7 -54.0 -15.0 -6.7 -1.4 46.9 77.3 -33.1 n.a. 2.3 0.4 1,302.1 1,272.0 30.1 2,151.9 1,394.7 757.2 40.2 55.4 -15.2 717.0 248.6 468.4 -553.5 -550.2 -455.6 -100.1 5.4 -3.3 410.3 247.7 141.6 n.a. 18.2 2.8 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61
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