NEWS

The U.S. attracted $28.7 billion in foreign direct investment between January
and March, the 12th consecutive quarter of positive flows, the Commerce
Department said Thursday.

Foreign direct investment includes long-term bets by companies and
individuals such as corporate acquisitions and real estate, but not purchases of
Treasury bonds and other U.S. securities.

Foreign investment in the U.S. last year totaled $234 billion, a 14% jump
over $205.8 billion in 2010, with around two-thirds of the cash coming from
Europe. The government initially estimated that investment flows dropped 4% last
year. Foreign investment in the U.S. has now exceeded its average of the past 10
years in 2010 and 2011, suggesting America’s lure for capital has recovered from
the crisis.

The coming months look even stronger. Acquisitions of U.S. firms by European
companies—the biggest source of foreign investment—totaled $7.5 billion in the
first quarter, according to data provider Dealogic. That is far below the $27.1
billion of deals already seen in the second. First quarters tend to be slow for
foreign investment. Meanwhile, the six-year drop in U.S. home prices has
Europeans and others scooping up American real estate, thanks in part to the
country’s perceived stability.

The pickup in foreign direct investment in the U.S. has boosted stock prices
and employment in the manufacturing sector, a cornerstone of the recovery.
Overseas investment collapsed in 2009 as economic turmoil froze global capital
flows.