Canada's international transactions in securities, November 2023
Released: 2024-01-17
Canadian investors purchased $12.5 billion of foreign securities in November, after divesting $8.2 billion in October. At the same time, foreign investors acquired $11.4 billion of Canadian securities, following three consecutive months of divestment totalling $39.7 billion.
As a result, international transactions in securities generated a net outflow of funds of $1.1 billion from the Canadian economy in November.
Chart 1
Canada's international transactions in securities
Unprecedented Canadian investment in US government bonds
Canadian investment in foreign securities amounted to $12.5 billion in November. The activity targeted US government bonds and, to a lesser extent, non-US foreign bonds. Investors acquired a record $10.1 billion of US government bonds, focusing on longer term instruments. US long-term interest rates were down by 30 basis points in November, the largest decrease since March 2020. At the same time, Canadian investment in non-US foreign bonds totalled $2.6 billion, largely government bonds.
Chart 2
Canadian investment in foreign bonds
On the other hand, Canadian investors marginally reduced their holdings of foreign equities by $545 million in November, after divesting $9.0 billion in October. Equity prices in major world equity markets were up in November, following declines in October.
Foreign investment in Canadian securities focuses on debt instruments
Foreign acquisitions of Canadian securities totalled $11.4 billion in November, led by investments in both government and corporate debt securities. A foreign divestment in equity securities moderated the overall investment activity in the month.
In November, foreign investors added $15.9 billion of Canadian debt securities to their portfolios, after three consecutive months of divestment totalling $33.2 billion. The activity was led by a $9.7 billion investment in federal government debt securities. In addition, non-resident investors acquired $7.7 billion of Canadian corporate bonds, mainly new bonds denominated in US dollars and issued by firms in the financial and the transportation industries. In November, Canadian long-term interest rates fell by 60 basis points, the largest decrease since December 2008.
Chart 3
Foreign investment in Canadian debt securities, by sector of issuer
Foreign investors sold $4.5 billion of Canadian shares in November, a tenth monthly divestment so far in 2023. Canadian share prices, as reflected by the Standard and Poor's/Toronto Stock Exchange composite index, were up 7.2% in November, the largest increase in three years.
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Note to readers
The data series on international transactions in securities covers portfolio transactions in equity and investment fund shares, bonds and money market instruments for both Canadian and foreign issues. This activity excludes transactions in equity and debt instruments between affiliated enterprises. These are classified as foreign direct investment in international accounts.
Equity and investment fund shares include common and preferred equities, as well as units or shares of investment funds. For the sake of brevity, the terms "shares" and "equity and investment fund shares" have the same meaning.
Debt securities include bonds and money market instruments.
Bonds have an original term to maturity of more than one year.
Money market instruments have an original term to maturity of one year or less.
Government of Canada paper includes Treasury bills and US-dollar Canada bills.
All values in this release are net transactions unless otherwise stated.
Next release
Data on Canada's international transactions in securities for December 2023 will be released on February 16, 2024.
Products
The Canada and the World Statistics Hub (13-609-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 (71-607-X), is available online.
The User Guide: Canadian System of Macroeconomic Accounts (13-606-G) is also available.
The Methodological Guide: Canadian System of Macroeconomic Accounts (13-607-X) is available.
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