The Canadian Press

Foreign investment in Canadian securities continued to increase in January, reaching $11.8 billion, with debt instruments continuing to attract the bulk of the inflow of funds.

In contrast, Statistics Canada reports Canadians removed $5.8 billion from their holdings of foreign securities in January, the largest reduction since December 2008.

Foreign investment in Canadian bonds was again robust at $10 billion in January.

Canadian federal government bonds accounted for two-thirds of this activity, both new issues abroad and secondary market purchases, while Canadian corporate bonds made up the balance.

Foreign funds of $2.5 billion were channelled to Canadian money market instruments in January, mostly three-month Federal Treasury bills.

Non-residents disposed of $649 million of Canadian stocks in January, the second monthly divestment in 12 months.

Canadian investors sold $5.6 billion of foreign bonds in January, the largest divestment since October 2008 at the height of the financial crisis.

The remainder of the divestment activity in January was in non-U.S. foreign bonds as Canadian investors removed $1.9 billion from their holdings, largely reflecting retirements of maple bonds.

Canadians added $373 million of foreign money market paper to their portfolios in January, all U.S. government paper.