The international investment position of the United States at the end of the third quarter of 2013.

Nguyen, Elena L.

THE NET international investment position of the United States at the end of the third quarter of 2013 was -$4,165.6 billion (preliminary), compared with -$4,455.0 billion (revised) at the end of the second quarter (chart 1, table 1). (1) The $289.5 billion increase in the net position reflected a $621.5 billion increase in the value of U.S.-owned assets abroad that exceeded a $332.1 billion increase in the value of foreign-owned assets in the United States. (2) The higher net position was mainly due to rising foreign stock prices and to a lesser extent, the appreciation of foreign currencies relative to the U.S. dollar.

The net position increased 6.5 percent in the third quarter, compared with a 5.2 percent decrease in the second quarter and an average quarterly decrease of 7.6 percent from the first quarter of 2011 through the second quarter of 2013. The net position was equal to 2.2 percent of the value of all U.S. financial assets at the end of the third quarter, down from 2.4 percent at the end of the second quarter. (3)

[GRAPHIC 1 OMITTED]

U.S.-owned assets abroad. U.S.-owned assets abroad were $21,590.9 billion at the end of the third quarter, compared with $20,969.4 billion at the end of the second quarter (chart 2). The $621.5 billion increase reflected a $687.4 billion increase in the value of U.S.-owned assets abroad excluding financial derivatives that was partly offset by a $65.9 billion decrease in the value of financial derivatives.

[GRAPHIC 2 OMITTED]

U.S.-owned assets abroad excluding financial derivatives were $18,831.7 billion at the end of the third quarter, compared with $18,144.3 billion at the end of the second quarter. The $687.4 billion increase reflected a $606.6 billion increase resulting from valuation changes and an $80.8 billion increase resulting from financial outflows. (4) Valuation changes were mainly attributable to the increase in foreign stock prices that raised the value of U.S. holdings of foreign stocks, but the changes were also attributable to the appreciation of foreign currencies relative to the U.S. dollar.

Foreign-owned assets in the United States. Foreign-owned assets in the United States were $25,756.5 billion at the end of the third quarter, compared with $25,424.4 billion at the end of the second quarter (chart 2). The $332.1 billion increase reflected a $385.8 billion increase in the value of foreign-owned assets in the United States excluding financial derivatives that was partly offset by a $53.8 billion decrease in the value of financial derivatives.

Foreign-owned assets in the United States excluding financial derivatives were $23,044.6 billion at the end of the third quarter, compared with $22,658.7 billion at the end of the second quarter. The $385.8 billion increase reflected a $230.3 billion increase resulting from valuation changes and a $155.6 billion increase resulting from financial inflows. Valuation changes were mostly attributable to increases in U.S. stock prices that raised the value of foreign holdings of U.S. stocks. The rise in the value of U.S. stocks was partly offset by declines in the value of U.S. Treasury and agency debt due to the falling prices of these debt instruments. The appreciation of foreign currencies relative to the U.S. dollar had little effect on the value of foreign-owned assets, which are mostly denominated in U.S. dollars.

Revisions

The U.S. net international investment position at the end of the second quarter of 2013 was revised to -$4,455.0 billion from a previously published value of -$4,504.1 billion. The $49.1 billion upward revision to the net position reflected a $63.9 billion downward revision to foreign-owned assets in the United States that exceeded a $14.9 billion downward revision to U.S.-owned assets abroad.

U.S.-owned assets abroad at the end of the second quarter were revised to $20,969.4 billion from $20,984.3 billion, and foreign-owned assets in the United States were revised to $25,424.4 billion from $25,488.4 billion. These revisions reflect revised source data from the Treasury International Capital reporting system and from BEA's quarterly surveys of direct investment.

(1.) For comprehensive international investment position statistics, including annual statistics beginning with 1976 and quarterly statistics beginning with the fourth quarter of 2005, see the table "International Investment Position, 1976-2013" at www.bea.gov.

(2.) For information on the valuation of U.S-owned and foreign-owned assets, see "Valuing the Components of the U.S. International Investment Position" at www.bea.gov.

(3.) Board of Governors of the Federal Reserve System (FRS), "Table L.5 Total Liabilities and Its Relation to Total Financial Assets," in Financial Accounts of the United States, Third Quarter 2013, Z.1. Statistical Release (Washington, DC: FRS, December 9, 2013): 11. According to the December 9, 2013 Z.1 release, the value of all U.S. financial assets was $188,503.7 billion at the end of the third quarter. U.S. assets abroad from the international investment position were $21,590.9 billion at the end of the third quarter, or 11.5 percent of all U.S. assets, up from 11.4 percent in the second quarter and down from the 13.8 percent peak in the fourth quarter of 2008.

(4.) For statistics on financial flows, see the financial account transactions in table 1 of the "U.S. International Transactions" in this issue of the SURVEY OF CURRENT BUSINESS. Financial flows discussed above are not seasonally adjusted. Detailed valuation changes such as price, exchange-rate, and other changes are available only for annual statistics.

Table 1. International Investment Position of the
United States at the End of the Quarter (1)

[Millions of dollars, not seasonally adjusted]

Line   Type of investment                             2012

                                             I            II

1      Net international investment          -3,886,446   -4,332,158
         position of the United States
         (lines 2+3)
2        Financial derivatives, net (line        76,286       67,589
           5 less line 25)
3        Net international investment        -3,962,732   -4,399,747
           position, excluding financial
           derivatives (line 6 less
           line 26)
4        U.S.-owned assets abroad (lines     21,349,048   20,948,183
           5+6)
5          Financial derivatives (gross       3,950,239    4,155,820
             positive fair value)
6          U.S.-owned assets abroad,         17,398,809   16,792,363
             excluding financial
             derivatives (lines 7+12+17)
7          U.S. official reserve assets         572,578      556,620
8            Gold (2)                           434,742      418,006
9            Special drawing rights              55,460       54,341
10           Reserve position in the             31,436       33,930
               International Monetary
               Fund
11           Foreign currencies                  50,940       50,343
12         U.S. government assets, other        127,814      111,164
             than official reserve assets
13           U.S. credits and other              80,642       82,500
               long-term assets (3)
14             Repayable in dollars              80,369       82,227
15             Other (4)                            273          273
16           U.S. foreign currency               47,172       28,664
               holdings and U.S.
               short-term assets (5)
17         U.S. private assets               16,698,417   16,124,579
18           Direct investment at             4,759,096    4,826,428
               current cost
19           Foreign securities               6,999,263    6,662,323
20             Bonds                          1,960,498    1,946,486
21             Corporate stocks               5,038,765    4,715,837
22           U.S. claims on unaffiliated        869,251      845,301
               foreigners reported by
               U.S. nonbanking concerns
23           U.S. claims reported by          4,070,807    3,790,527
               U.S. banks and securities
               brokers, not included
               elsewhere
24     Foreign-owned assets in the           25,235,494   25,280,341
         United States (lines 25+26)
25       Financial derivatives (gross         3,873,953    4,088,231
           negative fair value)
26       Foreign-owned assets in the         21,361,541   21,192,110
           United States, excluding
           financial derivatives
           (lines 27+34)
27       Foreign official assets in           5,428,122    5,496,057
           the United States
28         U.S. government securities         4,316,906    4,400,470
29           U.S. Treasury securities         3,722,551    3,857,872
30           Other                              594,355      542,598
31         Other U.S. government                123,406      125,065
             liabilities (6)
32         U.S. liabilities reported by         191,515      191,921
             U.S. banks and securities
             brokers, not included
             elsewhere
33         Other foreign official assets        796,295      778,601
34       Other foreign assets                15,933,419   15,696,053
35         Direct investment at current       2,913,781    2,976,814
             cost
36         U.S. Treasury securities           1,425,087    1,455,648
37         U.S. securities other than         6,608,954    6,491,227
             U.S. Treasury securities
38           Corporate and other bonds        2,927,923    2,887,851
39           Corporate stocks                 3,681,031    3,603,376
40         U.S. currency                        415,143      422,259
41         U.S. liabilities to                  683,453      680,186
             unaffiliated foreigners
             reported by U.S. nonbanking
             concerns
42         U.S. liabilities reported by       3,887,001    3,669,919
             U.S. banks and securities
             brokers, not included
             elsewhere
       Memoranda:
43     Direct investment abroad at            4,975,809    4,679,267
         market value
44     Direct investment in the United        3,855,543    3,764,768
         States at market value
45     Direct investment abroad at            4,169,123    4,224,965
         historical cost
46     Direct investment in the United        2,529,479    2,585,115
         States at historical cost

Line   Type of investment                              2012

                                             III          IV

1      Net international investment          -4,109,198   -3,863,892
         position of the United States
         (lines 2+3)
2        Financial derivatives, net (line        52,493       57,776
           5 less line 25)
3        Net international investment        -4,161,691   -3,921,668
           position, excluding financial
           derivatives (line 6 less
           line 26)
4        U.S.-owned assets abroad (lines     21,551,595   21,637,618
           5+6)
5          Financial derivatives (gross       3,925,606    3,619,761
             positive fair value)
6          U.S.-owned assets abroad,         17,625,989   18,017,857
             excluding financial
             derivatives (lines 7+12+17)
7          U.S. official reserve assets         606,277      572,368
8            Gold (2)                           464,422      433,434
9            Special drawing rights              55,232       55,050
10           Reserve position in the             35,248       34,161
               International Monetary
               Fund
11           Foreign currencies                  51,375       49,723
12         U.S. government assets, other         95,958       93,570
             than official reserve assets
13           U.S. credits and other              82,691       84,029
               long-term assets (3)
14             Repayable in dollars              82,418       83,756
15             Other (4)                            273          273
16           U.S. foreign currency               13,267        9,541
               holdings and U.S.
               short-term assets (5)
17         U.S. private assets               16,923,754   17,351,919
18           Direct investment at             4,983,377    5,077,750
               current cost
19           Foreign securities               7,159,326    7,531,223
20             Bonds                          2,052,037    2,140,685
21             Corporate stocks               5,107,289    5,390,538
22           U.S. claims on unaffiliated        845,865      844,752
               foreigners reported by
               U.S. nonbanking concerns
23           U.S. claims reported by          3,935,186    3,898,194
               U.S. banks and securities
               brokers, not included
               elsewhere
24     Foreign-owned assets in the           25,660,793   25,501,510
         United States (lines 25+26)
25       Financial derivatives (gross         3,873,113    3,561,985
           negative fair value)
26       Foreign-owned assets in the         21,787,680   21,939,525
           United States, excluding
           financial derivatives
           (lines 27+34)
27       Foreign official assets in           5,640,245    5,692,448
           the United States
28         U.S. government securities         4,487,789    4,526,896
29           U.S. Treasury securities         3,958,112    4,032,204
30           Other                              529,677      494,692
31         Other U.S. government                127,657      128,279
             liabilities (6)
32         U.S. liabilities reported by         198,987      204,401
             U.S. banks and securities
             brokers, not included
             elsewhere
33         Other foreign official assets        825,812      832,872
34       Other foreign assets                16,147,435   16,247,077
35         Direct investment at current       3,029,271    3,057,326
             cost
36         U.S. Treasury securities           1,517,253    1,541,569
37         U.S. securities other than         6,794,000    6,904,050
             U.S. Treasury securities
38           Corporate and other bonds        3,008,379    3,061,963
39           Corporate stocks                 3,785,621    3,842,087
40         U.S. currency                        438,415      454,227
41         U.S. liabilities to                  678,508      656,522
             unaffiliated foreigners
             reported by U.S. nonbanking
             concerns
42         U.S. liabilities reported by       3,689,988    3,633,383
             U.S. banks and securities
             brokers, not included
             elsewhere
       Memoranda:
43     Direct investment abroad at            5,058,812    5,249,539
         market value
44     Direct investment in the United        3,961,992    3,923,969
         States at market value
45     Direct investment abroad at            4,370,424    4,453,307
         historical cost
46     Direct investment in the United        2,630,175    2,650,832
         States at historical cost

Line   Type of investment                              2013

                                             I            II (r)

1      Net international investment          -4,236,559   -4,455,040
         position of the United States
         (lines 2+3)
2        Financial derivatives, net (line        40,025       59,352
           5 less line 25)
3        Net international investment        -4,276,584   -4,514,392
           position, excluding financial
           derivatives (line 6 less
           line 26)
4        U.S.-owned assets abroad (lines     21,590,055   20,969,405
           5+6)
5          Financial derivatives (gross       3,248,377    2,825,067
             positive fair value)
6          U.S.-owned assets abroad,         18,341,678   18,144,338
             excluding financial
             derivatives (lines 7+12+17)
7          U.S. official reserve assets         553,058      446,207
8            Gold (2)                           417,941      311,707
9            Special drawing rights              53,704       53,881
10           Reserve position in the             34,039       33,860
               International Monetary
               Fund
11           Foreign currencies                  47,374       46,759
12         U.S. government assets, other         94,016       90,901
             than official reserve assets
13           U.S. credits and other              85,433       88,636
               long-term assets (3)
14             Repayable in dollars              85,160       88,363
15             Other (4)                            273          273
16           U.S. foreign currency                8,583        2,265
               holdings and U.S.
               short-term assets (5)
17         U.S. private assets               17,694,604   17,607,230
18           Direct investment at             5,123,775    5,194,622
               current cost
19           Foreign securities               7,823,264    7,719,064
20             Bonds                          2,174,582    2,086,978
21             Corporate stocks               5,648,682    5,632,086
22           U.S. claims on unaffiliated        906,061      974,663
               foreigners reported by
               U.S. nonbanking concerns
23           U.S. claims reported by          3,841,504    3,718,881
               U.S. banks and securities
               brokers, not included
               elsewhere
24     Foreign-owned assets in the           25,826,614   25,424,445
         United States (lines 25+26)
25       Financial derivatives (gross         3,208,352    2,765,715
           negative fair value)
26       Foreign-owned assets in the         22,618,262   22,658,730
           United States, excluding
           financial derivatives
           (lines 27+34)
27       Foreign official assets in           5,814,441    5,744,199
           the United States
28         U.S. government securities         4,561,428    4,460,203
29           U.S. Treasury securities         4,090,723    4,009,152
30           Other                              470,705      451,051
31         Other U.S. government                128,554      132,268
             liabilities (6)
32         U.S. liabilities reported by         224,462      215,107
             U.S. banks and securities
             brokers, not included
             elsewhere
33         Other foreign official assets        899,997      936,621
34       Other foreign assets                16,803,821   16,914,531
35         Direct investment at current       3,074,647    3,101,291
             cost
36         U.S. Treasury securities           1,631,056    1,585,232
37         U.S. securities other than         7,296,277    7,258,691
             U.S. Treasury securities
38           Corporate and other bonds        3,056,573    2,940,348
39           Corporate stocks                 4,239,704    4,318,343
40         U.S. currency                        459,184      468,670
41         U.S. liabilities to                  632,919      626,418
             unaffiliated foreigners
             reported by U.S. nonbanking
             concerns
42         U.S. liabilities reported by       3,709,738    3,874,229
             U.S. banks and securities
             brokers, not included
             elsewhere
       Memoranda:
43     Direct investment abroad at            5,500,811    5,435,081
         market value
44     Direct investment in the United        4,251,181    4,333,762
         States at market value
45     Direct investment abroad at            4,499,331    4,570,179
         historical cost
46     Direct investment in the United        2,668,153    2,694,796
         States at historical cost

Line   Type of investment                    2013         Change:
                                                          2013:II to
                                                          2013:III

                                             III (p)

1      Net international investment          -4,165,583    289,457
         position of the United States
         (lines 2+3)
2        Financial derivatives, net (line        47,248    -12,104
           5 less line 25)
3        Net international investment        -4,212,831    301,561
           position, excluding financial
           derivatives (line 6 less
           line 26)
4        U.S.-owned assets abroad (lines     21,590,938    621,533
           5+6)
5          Financial derivatives (gross       2,759,201    -65,866
             positive fair value)
6          U.S.-owned assets abroad,         18,831,737    687,399
             excluding financial
             derivatives (lines 7+12+17)
7          U.S. official reserve assets         483,426     37,219
8            Gold (2)                           346,878     35,171
9            Special drawing rights              54,966      1,085
10           Reserve position in the             33,462       -398
               International Monetary
               Fund
11           Foreign currencies                  48,120      1,361
12         U.S. government assets, other         90,052       -849
             than official reserve assets
13           U.S. credits and other              88,933        297
               long-term assets (3)
14             Repayable in dollars              88,660        297
15             Other (4)                            273          0
16           U.S. foreign currency                1,119     -1,146
               holdings and U.S.
               short-term assets (5)
17         U.S. private assets               18,258,259    651,029
18           Direct investment at             5,318,629    124,007
               current cost
19           Foreign securities               8,291,808    572,744
20             Bonds                          2,127,228     40,250
21             Corporate stocks               6,164,580    532,494
22           U.S. claims on unaffiliated        980,805      6,142
               foreigners reported by
               U.S. nonbanking concerns
23           U.S. claims reported by          3,667,017    -51,864
               U.S. banks and securities
               brokers, not included
               elsewhere
24     Foreign-owned assets in the           25,756,521    332,076
         United States (lines 25+26)
25       Financial derivatives (gross         2,711,953    -53,762
           negative fair value)
26       Foreign-owned assets in the         23,044,568    385,838
           United States, excluding
           financial derivatives
           (lines 27+34)
27       Foreign official assets in           5,843,282     99,083
           the United States
28         U.S. government securities         4,485,873     25,670
29           U.S. Treasury securities         4,016,025      6,873
30           Other                              469,848     18,797
31         Other U.S. government                136,437      4,169
             liabilities (6)
32         U.S. liabilities reported by         245,159     30,052
             U.S. banks and securities
             brokers, not included
             elsewhere
33         Other foreign official assets        975,813     39,192
34       Other foreign assets                17,201,286    286,755
35         Direct investment at current       3,131,595     30,304
             cost
36         U.S. Treasury securities           1,638,634     53,402
37         U.S. securities other than         7,614,454    355,763
             U.S. Treasury securities
38           Corporate and other bonds        3,034,976     94,628
39           Corporate stocks                 4,579,478    261,135
40         U.S. currency                        481,334     12,664
41         U.S. liabilities to                  565,620    -60,798
             unaffiliated foreigners
             reported by U.S. nonbanking
             concerns
42         U.S. liabilities reported by       3,769,649   -104,580
             U.S. banks and securities
             brokers, not included
             elsewhere
       Memoranda:
43     Direct investment abroad at            5,980,129    545,048
         market value
44     Direct investment in the United        4,524,450    190,688
         States at market value
45     Direct investment abroad at            4,694,186    124,007
         historical cost
46     Direct investment in the United        2,725,102     30,306
         States at historical cost

(p) Preliminary

(r) Revised

(1.) The statistics for each quarter are the values as of the last day
of the quarter; the first quarter ends on March 31; the second
quarter ends on June 30; the third quarter ends on September 30;
and the fourth quarter ends on December 31 of the year.

(2.) U.S. official gold stock is valued at market price.

(3.) Also includes paid-in capital subscriptions to international
financial institutions and outstanding amounts of miscellaneous
claims that have been settled through international agreements to
be payable to the U.S. government over periods in excess of 1 year.
Excludes World War I debts that are not being serviced.

(4.) Includes indebtedness that the borrower may contractually, or
at its option, repay with its currency, with a third country's
currency, or by delivery of materials or transfer of services.

(5.) Includes foreign-currency-denominated assets obtained through
temporary reciprocal currency arrangements between the Federal
Reserve System and foreign central banks. These assets are included
in the investment position at the dollar value established at the
time they were received, reflecting the valuation of these assets
in the Federal Reserve System's balance sheet. Changes in exchange
rates do not affect this valuation.

(6.) Includes U.S. government liabilities associated with military
sales contracts and U.S. government reserve-related liabilities
from allocations of special drawing rights (SDRs).

Source: Bureau of Economic Analysis