Foreign Investment Sets Record in September

The healthy U.S. economy and higher interest rates are continuing to draw huge sums of foreign capital to American shores, new data indicate.

Foreigners in September bought $118.1 billion more in U.S. stocks and bonds than they sold, a record, the Treasury Department said Wednesday.

After subtracting Americans’ purchases of foreign securities, the net capital inflow to the U.S. also was a record, at $101.9 billion, up from $89 billion in August.

“It definitely dispels any worries that people will have about funding the American trade deficit,” said David Powell, an analyst for IDEAGlobal in New York.

“We are borrowing a lot, but it shows a lot of confidence in the U.S. economy,” said Kurt Karl, an economist at Swiss Re.

Foreigners bought fewer U.S. Treasury securities in September than in August, but their purchases of corporate bonds and stocks soared, data show.

The report on stock and bond purchases may understate foreign investment in the U.S. because it doesn’t include direct investment or bank accounts.