The International Investment Position of the United States at Yearend 2003

THE net international investment position of the United States was -$2,430.7 billion (preliminary) at yearend 2003, compared with -$2,233.0 billion (revised) at yearend 2002, with direct investment valued at current cost (table 1, chart 1). The change was the result of a larger rise in the value of

The -$197.7 billion change from yearend to yearend mainly resulted from large net foreign purchases of U.S. securities, which increased the value of foreign-owned assets in the United States; this increase was partly offset by a substantial rise in the dollar value of U.S.-owned assets abroad, especially of U.S.-held stocks, as a result of appreciation of most foreign currencies against the U.S. dollar.

On an alternative valuation basis with direct investment valued at market value, the net international position of the United States was -$2,651.0 billion (preliminary) at yearend 2003, compared with -$2,553.4 billion (revised) at yearend 2002. This article features estimates valued at the current cost of direct investment; however, estimates valued at the market value of direct investment are mentioned when the two valuations of direct investment differ substantially. The differences between the two methods are limited to the valuation of direct investment. All financial flows and all asset and liability positions except direct investment are identical under both of these valuation measures.