Canadian investment in foreign securities hits record high

Securities purchases from the United States helped Canada set a record high in international transactions

Canadian investors acquired a record $16.5 billion of foreign securities in November, according to Statistics Canada, while international buyers opted to reduce their holdings of Canadian bonds and money market instruments.
The record high in Canadian international transactions was largely the result of investors purchasing securities from the United States.
This increase includes record purchases of $8.7 billion of U.S. Treasury bonds and $7.4 billion of U.S. equities.
The total of Canada’s international transactions led to a net-outflow of $13.9 billion from the Canadian economy in November.
Meanwhile, foreign investment in Canadian securities dropped to $2.6 billion, following a $19.1-billion investment in October.
Foreign investment in Canadian bonds declined to $1.5 billion, down from $12.4 billion in October, while investment in money market instruments fell to $1.7 billion in November. 

The data highlight the effects of an extended period of monetary policy divergence between Canada and the United States that Bank of Canada Governor Stephen Poloz has cautioned about in recent speeches.

While the Federal Reserve lifted rates in December 2015, analysts believe Poloz is set to cut rates this year, possibly in his announcement today.

With files from Bloomberg