FDI in the US shrinks in the fourth quarter but holds steady for the full-year total in 2025
Foreign direct investment (FDI) in the United States reached $72 billion in the fourth quarter of 2025, shrinking 15 percent over the third quarter of 2025, according to preliminary data release by the US Bureau of Economic Analysis.
Net equity investment totaled $23 billion in Q4 2025, marking a sharp decline of around 40% compared with the previous quarter. Reinvested earnings remained the dominant component of inflows, reaching $51 billion and accounting for roughly 70% of total FDI during the period.
For the full year, FDI into the US came in at $288 billion, slightly below the decade-long annual average and broadly stable compared with 2024, with only a marginal year-on-year decrease.
The data also highlights the inherent volatility of quarterly FDI figures, which are often subject to revisions and can fluctuate significantly between reporting periods.
Even amid intensifying global competition for capital, the US continues to rank among the world’s most attractive investment destinations, the Global Business Alliance (GBA), a group representing foreign investors in the US, highlighted in its reaction to the data release, saying the US’s large domestic market, deep capital pools and well-established legal framework remain key draws for international investors, supporting employment, innovation and long-term economic competitiveness.
Japan and the Netherlands were the largest sources of foreign direct investment into the US in 2025, contributing $50 billion and $33 billion respectively. The UK, Germany and Canada also featured prominently, highlighting the continued importance of long-standing economic partners in driving capital flows into the US market.
By sector, manufacturing attracted the largest share of investment, accounting for $126 billion of total inflows. Wholesale trade and the information sector followed, drawing $47 billion and $23 billion respectively. Within manufacturing, the chemicals industry led activity, with $36 billion in investment.
Globally, FDI rose by around 14% to reach $1.6 trillion in 2025, according to UN Trade and Development (UNCTAD), with developed markets capturing the bulk of inflows. However, once conduit flows are excluded, underlying growth was closer to 5%, pointing to a more moderate expansion.
Technology-related investment continued to shape the global landscape. Data centre projects alone accounted for roughly 20% of the total value of greenfield announcements, while investment in semiconductors surged by 35%. Artificial intelligence also ranked among the top sectors for high-value project announcements, underlining the growing influence of digital infrastructure and advanced technologies on global capital flows.
