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Direct Investment by Country and Industry: 2017

The U.S. direct investment abroad position, or cumulative level of investment, increased $427.3 billion to $6,013.3 billion at the end of 2017 from $5,586.0 billion at the end of 2016. The increase mainly reflected a $243.6 billion increase in the position in Europe, primarily in Switzerland, the United Kingdom, Ireland, and the Netherlands. By industry, affiliates in manufacturing and holding companies accounted for the largest increases.

The foreign direct investment in the United States position increased $260.4 billion to $4,025.5 billion at the end of 2017 from $3,765.1 billion at the end of 2016. The increase mainly reflected a $128.2 billion increase in the position from Europe, primarily Ireland, Switzerland, and the Netherlands. By industry, affiliates in manufacturing and wholesale trade accounted for the largest increases.

FDI Chart

Highlights of the direct investment statistics by industry for 2017:

• The U.S. direct investment abroad position was highly concentrated in holding companies, which accounted for nearly half of the position in 2017. By industry of the U.S. parent, investment by manufacturing multinational enterprises accounted for 55.6 percent of the position.

• The foreign direct investment position in the United States was concentrated in the U.S.
manufacturing sector, which accounted for 39.9 percent of the position.

For more information, read the full report.

BEA’s 15th Comprehensive Update Improves Measurement of the Economy

BEA has updated gross domestic product and related statistics covering the past five years, and in some cases reaching back decades, to reflect newly available source data; improved seasonal adjustment; innovations in measuring the prices of software, medical equipment, and cellphones; and more.

After today’s comprehensive update, the general picture of U.S. economic activity remains largely the same.  From 2007-2017, real GDP is now estimated to have increased at an annual average rate of 1.5 percent; In our previously published estimates, GDP increased 1.4 percent.

Over the expansion period from the second quarter of 2009 through the fourth quarter of 2017, the estimate remains the same as previously reported, growing at an annual average rate of 2.2 percent.

Our updated statistics revise modestly the size of the economic contraction from the fourth quarter of 2007 to the second quarter of 2009. Real GDP decreased at an average annual rate of 2.7 percent; in the previously published estimates, it decreased 2.8 percent.

Updating previously published statistics is necessary to keep pace with an ever-changing economy while maintaining consistent long-term datasets. Annual GDP figures, for example, reach back to 1929.

This is BEA’s 15th comprehensive, or benchmark, update of the National Income and Product Accounts.  These updates are typically performed every five years, based on the Census Bureau’s every-five-years economic censuses, source of the most comprehensive industry and commodity data available.

The same 2012 Economic Census data also will underlie BEA’s 2012 Benchmark Input-Output Accounts when they are released in November.

Other major improvements in this update:

  • It completes our Three-Phase Seasonal Adjustment Improvement Plan begun in 2015. BEA has worked closely with the agencies that provide our source data to mitigate potential sources of “residual seasonality” – seasonal patterns that remain even after data have been adjusted to smooth out seasonal variations. Extensive testing found no signs of residual seasonality in our updated data.
  • As part of the seasonal adjustment improvement plan, today we released estimates of GDP, gross domestic income, and their major components that have not been seasonally adjusted. Going forward, not seasonally adjusted estimates will be published at the same time as seasonally adjusted estimates, providing greater transparency and an additional tool for evaluating the economy.
  • We’ve improved our measurement of the digital economy. We incorporated price indexes that better capture innovations and improved quality in software, medical equipment, and cellphones, to more accurately measure their contributions to growth and productivity. We also updated measurements of private investment related to cloud computing.

BEA’s reference year for its inflation adjustment and price measures is updated to 2012. The reference year normally moves forward five years during comprehensive updates, but this time it moves three years. That’s because the last comprehensive update was a special case. We used 2009 as the reference year, instead of 2007, to avoid setting the reference period during the start of the latest recession, which the National Bureau of Economic Research dated to December 2007.

GDP Increases in Second Quarter

Real gross domestic product (GDP) increased 4.1 percent in the second quarter of 2018, according to the “advance” estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP increased 2.2 percent (revised).

GDP highlights
GDP July27The second-quarter increase in real GDP reflected increases in consumer spending, exports, business investment, and government spending, while inventory investment and housing investment decreased. Imports, which is a subtraction in the
calculation of GDP, increased.

The increase in consumer spending reflected increases in services and in both durable and nondurable goods. The increase in exports
reflected increases in exports of goods.

The increase in business investment reflected increases in structures, intellectual property products, and equipment. The increase in government spending reflected increases in federal national defense, and state and local government spending.

Personal income and saving
Real disposable personal income—personal income adjusted for taxes and inflation—increased 2.6 percent in the second quarter after increasing 4.4 percent in the first quarter. Personal saving as a percent of disposable personal income was 6.8 percentin the second quarter, compared with 7.2 percent in the first quarter.

Second-quarter pricesGDP2 July 27
Prices of goods and services purchased by U.S. residents increased 2.3 percent in the second quarter of 2018, after increasing 2.5 percent in the first quarter.

Food and energy prices both increased in the second quarter.

Excluding food and energy, prices increased 2.4 percent in the second quarter, the same as in the first quarter.

Comprehensive update
BEA also released its 2018 comprehensive update of the national income and product accounts, which incorporated newly available and revised source data for 2013 –2017. From the fourth quarter of 2012 to the fourth quarter of 2017, real GDP increased at an annual average rate of 2.3 percent, a downward revision of 0.1 percentage point.

For more information, read the full report.

 


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