Reports on the 25th (local time) in the Wall Street Journal (WSJ) show that foreign investment is flowing into the United States.
In the first half of this year, global investors invested more than $900 billion into United States mutual funds and exchange-traded funds (ETFs), according to data from financial information provider Refinitive Reaper. In fact, this is the highest amount since 1992 and greater than any overseas investments during the same period.
It appears, however, that inflows of capital have slowed somewhat in recent years. Inflows into U.S. funds fell from $168 billion in May to $51 billion last month. It fell below $100 billion for the first time since January of this year.
WSJ pointed out that global investment is flowing to the U.S. because U.S. economic growth will exceed others’ due to the predicted COVID-19 pandemic.
Changes to the Federal Reserve’s policy and changes to the Delta could slow the U.S. economic recovery, but investors do not expect major changes.
According to the WSJ survey, economists expect the U.S. economy to grow by 6.9 percent this year. This is higher than the International Monetary Fund’s (IMF) growth projections for most developed and emerging countries.
The influx of foreign investors is expected to continue.
According to Goldman Sachs, foreign investors are expected to add an additional $200 billion in U.S. stocks to their portfolios this year.