The Daily
|
 In the news  Indicators  Releases by subject
 Special interest  Release schedule  Information

Canada's international transactions in securities, February 2018

Warning View the most recent version.

Archived Content

Information identified as archived is provided for reference, research or recordkeeping purposes. It is not subject to the Government of Canada Web Standards and has not been altered or updated since it was archived. Please "contact us" to request a format other than those available.

Released: 2018-04-17

Foreign investment in Canadian securities totalled $4.0 billion in February, down from $5.6 billion in January. Meanwhile, Canadian investment in foreign securities slowed to $6.3 billion, following two months of strong acquisitions.

As a result, international transactions in securities generated a net outflow of funds of $2.4 billion from the Canadian economy, a third consecutive monthly net outflow of funds.

Foreign investors reduce their holdings of federal government bonds

Foreign investors added $4.0 billion of Canadian securities to their portfolios in February. Foreign investors increased their holdings of Canadian corporate securities and sold federal government bonds in the month.

Chart 1  Chart 1: Foreign investment in Canadian securities
Foreign investment in Canadian securities

Foreign investors reduced their holdings of Canadian bonds by $897 million in February, a third consecutive month of divestment. The activity in the month reflected sales of government bonds moderated by purchases of corporate bonds. Foreign investors reduced their holdings of federal government bonds by a record $12.5 billion in February, largely sales of medium-term bonds on the secondary market.

Since the beginning of the year, foreign investors have reduced their holdings of federal government bonds by $14.0 billion, compared with total investments of $36.0 billion in the second half of 2017. Non-residents acquired $8.1 billion of corporate bonds in February, mainly new issues denominated in US dollars. Meanwhile, foreign investment in provincial government bonds reached $3.4 billion, the highest level since May 2017.

Canadian long-term interest rates were down by six basis points in the month, the first decline in three months and following a general upward trend that began in June 2017. The Canadian dollar depreciated against its US counterpart by 3.3 US cents in February.

Chart 2  Chart 2: Foreign investment in federal government bonds
Foreign investment in federal government bonds

Foreign investment in Canadian money market instruments slowed to $2.0 billion in February, following a $6.1 billion investment in January. Foreign acquisitions of federal government and federal government business enterprises paper were moderated by a divestment in private corporate paper during the month. Canadian short-term interest rates were down by six basis points in February.

Foreign investment in Canadian equities amounted to $2.9 billion in February, the largest investment in five months. Foreign purchases mainly targeted shares from the finance and insurance sector and more specifically the banking sector. Canadian stock prices were down 3.2% in February.

Canadian investment in foreign securities slows

Canadian acquisitions of foreign securities slowed to $6.3 billion in February, following strong investment of $35.2 billion in the previous two months.

Canadian investment in foreign equities totalled $4.7 billion in February and mainly targeted US shares. US stock prices, which fell early in the month and partially recovered thereafter, were down by 3.9% in February.

Canadian investors added $1.6 billion of foreign debt securities to their holdings in February. Purchases of non-US foreign instruments were moderated by sales of US Treasury bills in the month. US long-term interest rates rose by 28 basis points and short-term interest rates increased by 16 basis points in the month.

Chart 3  Chart 3: Canadian investment in foreign securities
Canadian investment in foreign securities


  Note to readers

The data series on international transactions in securities covers 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, which are 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.

Next release

Data on Canada's international transactions in securities for March will be released on May 17.

Products

The Methodological Guide: Canadian System of Macroeconomic Accounts (Catalogue number13-607-X) is available.

The User Guide: Canadian System of Macroeconomic Accounts (Catalogue number13-606-G) is also available. This publication will be regularly updated to maintain its relevance.

The updated Canada and the World Statistics Hub – United States (Catalogue number13-609-X) is available online. This product illustrates the nature and extent of Canada's economic and financial relationship with the United States using interactive graphs and tables. This product provides easy access to information on trade, investment, employment and travel, including merchandise trade by Canadian provinces and US states.

Contact information

For more information, contact us (toll-free 1-800-263-1136; 514-283-8300; STATCAN.infostats-infostats.STATCAN@canada.ca).

To enquire about the concepts, methods or data quality of this release, contact Lauren Dong (613-668-3140; lauren.dong@canada.ca), International Accounts and Trade Division.

Report a problem on this page

Is something not working? Is there information outdated? Can't find what you're looking for?

Please contact us and let us know how we can help you.

Privacy notice

Date modified: