Capital Flows

Capital flows mean the movement of money between countries, markets, or asset classes. In simple terms, capital flows show where investment money is going. Capital flows are important because they can affect currencies, stock markets, bond yields, and economic growth. Strong inflows can support asset prices, while outflows can pressure markets and currencies. For example, if foreign investors buy more U.S. stocks and bonds, capital is flowing into U.S. markets. Capital flows are not always stable. They can change quickly when interest rates, risk appetite, or economic expectations shift.