On the flip side, foreign investors reduced their holdings in Canadian money market instruments by $7.1 billion in November, in addition to a $6.1 billion divestment in October, particularly in provincial government securities. Statistics Canada attributes this decline to large retirements for two consecutive months.
Meanwhile, Canadian long-term interest rates were up slightly by 12 basis points. Short-term interest rates were also up, but by less than long-term rates, widening the gap between them.
Canadian invested in foreign securities also strengthened. Investors acquired $6.6 billion of foreign securities (all bonds) – the largest investment in a year, reported Statistics Canada. Foreign bonds reached $7.5 billion in November – the highest in this area since 2007 – led by U.S.
treasury bonds and Canadian dollar-denominated corporate foreign bonds.
Meanwhile, Canadian investors reduced their holdings of foreign equities by $0.4 billion in November – down for the third consecutive month – mainly in U.S.
securities, which follows an additional divestment of $2.1 billion in October.
Foreigners return to Canadian securities markets
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