Canada's international transactions in securities, October 2016

Released: 2016-12-16

Foreign acquisitions of Canadian securities amounted to $15.8 billion in October, mainly Canadian corporate debt securities. At the same time, Canadian investors added $2.1 billion of foreign securities to their holdings, led by acquisitions of US corporate instruments.

Foreign investment in Canadian securities increases

Foreign acquisitions of Canadian securities reached $15.8 billion in October, above the monthly average investment of $13.7 billion from January to September. The activity was mainly concentrated in Canadian debt securities issued by private corporations, both short- and long-term instruments.

Chart 1 
Foreign investment in Canadian securities

Non-resident investors resumed their acquisitions in the Canadian money market by adding $7.7 billion worth to their holdings in October, following a $5.4 billion divestment in September. Foreign acquisitions of private corporate paper accounted for the bulk of the investment, reaching a record $6.8 billion, mainly paper denominated in foreign currencies. Canadian short-term interest rates were down slightly and the Canadian dollar depreciated against its US counterpart by 1.7 US cents in the month.

Foreign investment in Canadian bonds slowed to $6.3 billion in October. Foreign acquisitions of Canadian private corporate bonds amounted to $5.0 billion, mainly new issues denominated in foreign currencies. This followed an investment of $11.1 billion in these instruments in September.

Non-resident investors acquired $2.1 billion of government bonds, largely purchases on the secondary market. A reduction in foreign holdings of federal government enterprise bonds moderated the overall investment. Canadian long-term interest rates were up by 17 basis points in October, following five consecutive months of decline.

Foreign investors acquired $1.8 billion of Canadian equities in October, following a $5.7 billion investment in September. Issuance of new Canadian shares to non-resident portfolio investors, resulting from cross-border mergers and acquisitions, led the activity during the month. Canadian stock prices edged up in October.

Canadian investment in foreign securities focuses on US instruments

Canadian investors added $2.1 billion of foreign securities to their holdings in October, led by acquisitions of US corporate securities.

Canadian acquisitions of foreign shares amounted to $1.7 billion and reflected a $3.2 billion purchase of US shares, partially offset by a $1.5 billion sale of non-US foreign shares. US stock prices were down by 1.9% in October.

Canadian investment in foreign debt securities totalled $433 million in October, following two months of divestment. The investment activity was mainly in US corporate bonds and, to a lesser extent, non-US foreign bonds. A $3.1 billion reduction in US government bonds moderated the overall investment in the month. This was the third consecutive month of divestment in US government bonds. US short-term interest rates were up by 4 basis points and long-term interest rates were up by 13 basis points in the month.

Chart 2 
Canadian investment in foreign securities

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.