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Canada's international transactions in securities, November 2017

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Released: 2018-01-19

Foreign investment in Canadian securities amounted to $19.6 billion in November, mainly purchases of Canadian bonds. Meanwhile, Canadian investors reduced their holdings of foreign securities by $4.6 billion, following strong acquisitions in October.

Foreign investment in Canadian bonds remains strong

Foreign investment in Canadian securities amounted to $19.6 billion in November, following an investment of $20.8 billion in October. Overall, foreign investors acquired Canadian debt securities but reduced their holdings of equities in the month.

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

Non-resident acquisitions of Canadian bonds stood at $17.8 billion in November. Foreign investors acquired $8.8 billion of federal government bonds, the fifth consecutive month of strong investment. From July to November, foreign acquisitions of federal government bonds have totalled $36.6 billion, compared with a divestment of $7.9 billion in the first half of the year (January to June). Non-resident investors also added $6.6 billion of private corporate bonds to their holdings in November. Canadian long-term interest rates were down by 16 basis points in the month.

Foreign investors resumed their acquisitions of Canadian money market instruments by adding $2.3 billion to their holdings in November, the first investment in three months. Foreign purchases of $1.9 billion in private corporate paper accounted for the majority of the investment. Canadian short-term interest rates were down by four basis points and the Canadian dollar was almost unchanged compared with the US dollar in November.

Non-resident investors reduced their holdings of Canadian equities by $507 million in November, the first divestment since January 2017. The reduction was related to cross-border merger and acquisition activities, as foreign portfolio investors rendered Canadian shares to foreign direct investors during the month. Foreign acquisitions of $1.0 billion of Canadian shares on the secondary market moderated the overall divestment in the month. Canadian stock prices edged up in November.

Canadian investors sell US shares

Canadian investors reduced their holdings of foreign securities by $4.6 billion in November, the first divestment in four months. The divestment was in both foreign debt securities and foreign equities.

Canadian investors sold $4.2 billion of foreign equities in November, following an investment of $14.3 billion in October. Record sales of $5.8 billion of US shares were moderated by purchases of non-US foreign shares in November. US stock prices were up by 2.3% in the month.

Canadian holdings of foreign debt securities were down by $385 million in November, the first divestment in five months. Sales of non-US foreign bonds were moderated by acquisitions of US Treasury instruments in the month. US long-term interest rates edged down, while short-term rates were up by 16 basis points in the month.

Chart 2  Chart 2: 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 December 2017 will be released on February 16, 2018.

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 the 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.

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