Foreign investors piled into Canadian equities and bonds in October, according to Statistics Canada.
In a report Tuesday, the national statistical agency said offshore investors added $21.5 billion worth of Canadian securities to their portfolios in October, marking the second straight month of foreign capital inflows.
Investors added $11.8 billion of Canadian debt in the month, StatCan reported.
In particular, foreign investors added $8.4 billion worth of corporate bonds and $8.1 billion in federal government bonds. This was partly offset by a $2.0-billion reduction in provincial bond holdings and a $2.1-billion divestment from money-market instruments that primarily targeted corporate paper.
At the same time, foreign investors increased their exposure to Canadian equities, the report said, adding $9.8 billion worth of stocks in October.
Conversely, Canadian investors reduced their holdings of foreign securities for the first time since January.
In October, domestic investors dumped $15.6 billion worth of foreign equities, which was the largest divestment in the category since March 2022. Most of the monthly total — $11.1 billion — came from U.S. stocks, while the other $4.5 billion was in other foreign equities.
The selling of foreign stocks was largely offset by Canadian investors adding foreign debt securities. In October, investors increased these exposures by $12.9 billion, driven by an $11.2-billon acquisition of foreign bonds.
“Canadian investors, mainly pension funds, acquired $10.4 billion of non-U.S. foreign bonds in October, the largest monthly investment on record,” StatCan said.
These acquisitions of foreign debt, combined with the equity divestment, resulted in an overall $2.6-billion divestment by Canadian investors in October. With foreign investors adding Canadian securities, international transactions in securities generated a net inflow of $24.2 billion to the Canadian economy in the month.