Canada's international transactions in securities, May 2023

Released: 2023-07-17

Foreign investment in Canadian securities totalled $11.2 billion in May, led by strong foreign purchases of federal government debt securities. Meanwhile, Canadian investors reduced their holdings of foreign securities by $2.8 billion, led by sales of US government debt securities. As a result, international transactions in securities generated a net inflow of funds of $13.9 billion into the Canadian economy in May.

Chart 1 
Canada's international transactions in securities

Foreign investment in Canadian securities focuses on federal government debt securities

Foreign acquisitions of Canadian securities continued in May as non-resident investors purchased $11.2 billion worth, after investing $12.8 billion in April. In May, foreign investment targeted federal government debt securities and was moderated by a reduction in foreign holdings of Canadian private corporate instruments.

More precisely, foreign investors increased their exposure to federal government debt securities by $16.9 billion in May, led by a record-high $11.8 billion investment in government of Canada paper. A reduction in foreign holdings of private corporate paper moderated the investment activity in the month. In May, Canadian short-term interest rates were up to reach the highest levels since February 2001.

Chart 2 
Foreign investment in Canadian debt securities, by sector of issuer

Foreign investors reduced their holdings of Canadian shares by $4.9 billion in May, a sixth consecutive monthly divestment. Canadian share prices, as measured by the Standard and Poor's/Toronto Stock Exchange composite index, were down by 5.2% in May.

Canadian investors reduce their exposure to US government debt securities

Canadian investors reduced their holdings of foreign securities by $2.8 billion in May, after acquiring $2.4 billion worth in April. In May, the divestment in US government debt securities totalled $5.6 billion, the largest amount since April 2020. This activity was moderated by investments in US corporate bonds ($1.8 billion) and non-US foreign bonds ($1.1 billion) in May 2023. Meanwhile, Canadian investment in foreign shares slowed to $231 million in May compared with $3.5 billion in April.

Chart 3 
Canadian investment in foreign bonds

Products

The Canada and the World Statistics Hub (Catalogue number13-609-X) is available online. This product illustrates the nature and extent of Canada's economic and financial relationship with the world using interactive graphs and tables. This product provides easy access to information on trade, investment, employment and travel between Canada and a number of countries, including the United States, the United Kingdom, Mexico, China, and Japan.

As a complement to this release, the data visualization product "Securities statistics," part of the series Statistics Canada – Data Visualization Products (Catalogue number71-607-X), is available online.

The User Guide: Canadian System of Macroeconomic Accounts (Catalogue number13-606-G) is also available.

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

Contact information

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