Canada's international transactions in securities, July 2014
Canadian investors added $9.7 billion of foreign securities to their portfolios in July, the largest such investment since April 2007. Meanwhile, foreign investors acquired $5.3 billion of Canadian securities, mainly instruments from the corporate sector.
Canadian investment in foreign securities accelerates
In July, Canadian acquisitions of foreign securities were the highest since April 2007 at $9.7 billion. Canadian investors added both equity and debt instruments to their holdings, favouring US securities.
Canadian investment in foreign stocks amounted to $6.2 billion and was evenly split between US and non-US foreign shares. This marked a ninth straight month of investment in these instruments. Since the beginning of the year, Canadian investors have acquired $25.6 billion of foreign shares with a focus on non-US foreign shares.
Canadian investors also purchased $4.0 billion of foreign bonds in July as acquisitions targeted US bonds from the government and corporate sectors. A divestment in US Treasury bills and non-US foreign debt securities moderated the overall outflows during the month.
Non-resident investors resume their acquisitions of Canadian securities
Non-residents invested $5.3 billion in Canadian securities in July, following a divestment the previous month. Activity in the Canadian stock market dominated with foreign acquisitions totalling $4.7 billion. Foreign investment in Canadian shares has amounted to $21.5 billion so far this year, with Canadian stock prices up by 12.5% over this period.
Foreign investors acquired $623 million of Canadian debt securities in July. Foreign investment in Canadian bonds amounted to $2.5 billion, mainly in corporate bonds. Foreign investors added $931 million of federal government bonds to their holdings, following a $9.4 billion divestment in June. Since the beginning of the year, foreign investors have purchased $25.4 billion of corporate bonds while they divested $10.5 billion of federal government bonds on large retirements.
In the Canadian money market, there was a $1.9 billion reduction in foreign holdings of these instruments, mainly retirements. Government of Canada paper and federal government business enterprise paper accounted for most of the decline. At the same time, non-resident investors acquired $1.2 billion of private corporate paper, which moderated the overall divestment. The Canadian dollar depreciated against its US counterpart by 2 US cents at the end of the month.
Note to readers
The data series on international transactions in securities cover portfolio transactions in equity and investment fund shares, bonds and money market instruments for both Canadian and foreign issues. This activity excludes transactions in equity and debt instruments between affiliated enterprises, classified as foreign direct investment in the international accounts.
Equity and investment fund shares include common and preferred equities as well as units/shares of investment funds.
Debt securities include bonds and money market instruments.
Bonds have an original term to maturity of more than one year.
Money market instruments have an original term to maturity of one year or less.
Government of Canada paper includes Treasury bills and US-dollar Canada bills.
All values in this release are net transactions unless otherwise stated.
Data on Canada's international transactions in securities for August will be released on October 16.
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To enquire about the concepts, methods or data quality of this release, contact Lauren Dong (613-951-3282; email@example.com), International Accounts and Trade Division.
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