Foreign investors flocked to Canadian corporates in Q3

Foreign investors snapped up Canadian securities, while domestic investors trimmed their foreign holdings — driving positive portfolio flows to close the third quarter — according to data from Statistics Canada.

In September, foreign investors added $4.8 billion worth of Canadian securities on net, powered by the acquisition of $6.0 billion in Canadian bonds, StatsCan reports.

Foreign buying of corporate bonds was even stronger, with investors adding $10.4 billion worth of Canadian corporate bonds during the month.

This was offset by investors selling $2.8 billion in government bonds.

For the third quarter, foreign investors bought $18.8 billion in Canadian corporate bonds, StatsCan reported.

Additionally, foreign investors added $1.1 billion in Canadian equities in September, and sold $2.4 billion worth of short-term Canadian money market investments.

During the month, Canadian investors also sold $2.4 billion in foreign securities, primarily U.S. securities.

“The decrease in holdings of U.S. securities in September reflected sales of shares and Treasury bonds, partially offset by acquisitions of corporate bonds,” StatsCan said.

With foreign investors adding Canadian securities and Canadian investors selling foreign investments, the Canadian economy enjoyed a $7.2-billion net portfolio inflow in September.

Staff

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