By Robb M. Stewart
OTTAWA–Foreign investors cut their holdings of Canadian securities in September, largely due to the retirement of bonds, while Canadian investors ended the quarter with the largest investment in foreign securities in years.
Nonresident investors in September sold a net 15.09 billion Canadian dollars, the equivalent of $10.97 billion, in Canadian securities, Statistics Canada said Friday.
The data agency said there was a C$17.55 billion reduction in foreign holdings of Canadian bonds, with retirements in September reaching about C$2.4 billion, the highest amount since December 2018. The retirements were in both government and corporate bonds, and comes after Canadian long-term interest rates in September reached the highest level since December 2007.
Still, non-resident investors picked up C$1.62 billion of Canadian shares for the month after nine consecutive months of selling.
Canadian investors bought C$11.60 billion in foreign securities, led by C$10.46 billion added to holdings of international bonds. The rise meant Canadians ended the third quarter with the biggest investment in foreign securities since the final quarter of 2021.
Canadian acquisitions of foreign shares slowed to C$1.74 billion in September, yet totaled roughly C$20.3 billion for the quarter, the highest amount since the fourth quarter of 2021.
As a result, international transactions generated a net outflow from the Canadian economy of C$26.69 billion in September, and the outflow reached a record C$41.4 billion for the third quarter to completely offset the C$39.4 billion inflow recorded in the first six months of the year.
The monthly international securities report covers a portfolio of transactions in equity and investment fund shares, bonds and money market instruments for both Canadian and foreign issues. The activity excludes transactions in equity and debt instruments between affiliated enterprises.
Write to Robb M. Stewart at [email protected]
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