Data reveals the largest investment in foreign shares since April 2022
Canadian investors were bullish on international securities in August, the latest month of data available from Statistics Canada.
A total of $14.9 billion in foreign securities were acquired by Canadians in the month, of which $10.9 billion was foreign equities. It was the largest investment in foreign shares since April 2022 and consisted of $6.7 billion for US shares – mostly large cap technology stocks - and $3.9 billion for non-US, mostly Asian and European markets.
With US long-term interest rates reaching a 16-year high in August, Canadian investors also added $3.7 billion in US government bonds to their portfolios.
Foreign investors pull back
However, foreign investors pulled back from Canadian securities with $8.5 billion divested, snapping a four-month run of strong investments.
Almost $6 billion in Canadian equities was divested by non-resident investors with most industries impacted with the exception of banking and trade and transportation industries. The year-to-date divestment rose to $40.5 billion, way above the $3.5 billion divested in the same period of 2022.
Foreign investors also ended their love affair with Canadian bonds after four months when they added $70.4 billion to their portfolios. August’s $2.7 billion divestment was led by retirements of federal government bonds (-$6.7 billion) but moderated by a $4.3 billion investment in federal government paper.
Canadian corporates issued their lowest level of bonds in nine months.
