capital flows
Cross-border investment transfers
Capital flows are movements of money across borders for investment, trade, or speculation.
When investors buy foreign stocks, corporations build factories abroad, or banks lend internationally, capital flows between countries.
Economists track these movements as indicators of economic health and investor confidence: Capital flows into emerging markets surged after interest rates fell.
Large or sudden flows can destabilize currencies and financial systems.
- bondsTies that unite
- interest ratesPrice paid for borrowing
- carry tradeBorrowing cheaply to invest higher
- hot moneyRapidly moving speculative funds
- monetary policyCentral bank economic controls
repatriation · investment · economic growth · contagion · sudden stop · sovereign debt · swaps · balance of payments · hedge funds · safe haven · remittances · stocks · inflation rates · private equity · risk appetite · liquidity · exchange rates · derivatives