Developments in the U. S. economy, because of its size and international linkages, are bound to have substantial implications for the global economy

Linkages between the United States and the World With an estimated nominal GDP of more than $18 trillion in 2016, the United States is the world’s single largest economy and has the world’s third largest population. It accounts for more than 25 percent of global GDP (at 2015 market exchange rates), 11 percent of global trade, 12 percent of bank foreign claims, and 35 percent of global stock market capitalization (Figures 1 and 2). The U.S. share of global output and trade has remained broadly stable since the 1980s, whereas the share of other major advanced economies has declined gradually. The United States is the single largest international creditor and debtor: it holds the largest stock of foreign assets and liabilities and, by a wide margin, the largest net foreign asset position.

U.S. trade and financial integration with other advanced economies and EMDEs—especially in Latin America and the Caribbean (Figure 3)—runs deep. Countries whose trade and financial ties are predominantly with the United States are directly exposed to U.S. developments. In addition, those that are in general highly open to global trade and finance are indirectly exposed because of widespread spillovers from the United States.