Capital flows play an important role in the global economy because they help countries fund investment and growth. For example, if a company from one country invests in another country, it can bring in new capital, technology, and jobs to the host country.

On the flip side, large capital outflows from a country can be a sign of weak economic conditions and can lead to instability in exchange rates and financial markets. Overall, capital flows are a key indicator of the health and interconnectedness of the global economy.