U.S. Economic Strength Boosts Global Financial Dominance

The United States has strengthened its global financial dominance due to the robust economic recovery post-. The Biden administration's focus on infrastructure, clean energy, and semiconductor technology has significantly increased foreign direct investment, particularly from allies such as Canada, Japan, South Korea, and the U.K. The U.S. attracted 41% of global gross capital inflows in 2022-23, almost double its pre-pandemic share. The U.S. dollar remains the world's major reserve currency, with its real trade-weighted value 15% above its 20-year average. Britain was the largest contributor to U.S. capital inflows in 2023, while South Korea led in foreign direct investment, driven by tax credits promoting renewable energy and semiconductor sectors. The total foreign direct investment stock in the U.S. has more than doubled since 2009 to $5.4 trillion in 2023, while both U.S. and Chinese outbound and inbound investments have seen declines.