Foreign investment in Canadian securities keeps booming

Foreign investment in Canadian securities in May continued on par with the strong pace recorded in the previous four months

Acquisitions of federal government bonds on the secondary market led the way for $14.7 billion in foreign investment in Canadian securities in May. At the same time, Canadian investors acquired $5.1 billion in foreign securities – mainly equities, according to Statistics Canada.

Foreign investment in Canadian securities was on par with the strong investment pace recorded in the previous four months, Statistics Canada reported. In May, foreign investors were focused largely on Canadian bonds. Since the beginning of the year, foreign acquisitions on Canadian securities have totaled $74.6 billion. During the same period in 2015, it totaled $66.2 billion.

Foreign investment in Canadian bonds totaled $17.3 billion in May, the largest investment since March of last year. Meanwhile, foreign investors reduced their holdings of Canadian money market instruments by $3.4 billion. Foreign investments in Canadian equities also slowed, with investors adding $819 million in Canadian shares, Statistics Canada reported.

Meanwhile, Canadian investors’ acquisition of $5.1 billion in foreign securities in May marked the fourth straight month of investment. Most of the investment took the form of equities and targeted the U.S. stock market, Statistics Canada reported.

Canadian investors acquired foreign shares totaling $4.7 billion, the highest investment so far this year. Investment in U.S. equities hit $3.1 billion – the highest since November of last year. Canadian investment in foreign debt securities, meanwhile, slowed to $350 million in May, Statistics Canada reported. Investors decreased their holdings of U.S. bonds by $3 billion, and reduced their exposures to non-U.S. foreign bonds by $2.9 billion.

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