Foreign acquisitions of Canadian securities reached a five-year high of $18.9 billion in May, fuelled by new issues of Canadian corporate bonds, Statistics Canada said Monday.

StatsCan said non-resident investors purchased an unprecedented $19.4 billion of Canadian bonds in May, largely corporate bonds.

At the same time, they reduced their holdings of Canadian money market instruments by $1.5 billion, mainly due to retirements.

Canadian firms, mainly from the energy and resources sectors, issued $9.3 billion of new bonds in foreign markets in May, nearly all U.S. dollar-denominated bonds placed in the U.S. market.

Foreign investors also acquired $6.5 billion of Canadian bonds on secondary markets in May.

Canadians, meanwhile, sold $985 million of foreign securities, marking their first divestment in 2009.

Canadian investment in foreign debt securities concentrated on short-term instruments in May, as investors in Canada sold $733 million of foreign bonds in favour of $965 million of foreign money market paper.

IE