OTTAWA (Reuters) - Foreigners invested heavily in Canadian bonds in November as credit markets recovered and the Canadian dollar rose, pushing total purchases of Canadian securities to C$10.54 billion ($10.23 billion) in the month, Statistics Canada said on Monday.
Their net purchase of C$97.82 billion in the first 11 months of 2009 is higher than any previous annual foreign investment on record.
In November, foreigners bought C$12.90 billion worth of bonds, more than double the previous month’s acquisitions, including C$7.2 billion in corporate bonds. Most of the interest in the corporate sector was in new issues. Nonresidents also acquired C$1.6 billion in federal government bonds and C$3.1 billion in provincial government bonds.
The federal government issued more debt last year than in previous years as it slid into a deficit and analysts have said foreigners were likely betting on higher yields and a continued appreciation of the Canadian dollar against the U.S. dollar.
Foreigners divested C$1.9 billion worth of short-term money market, continuing a trend that began in July, and shed C$464 million in stocks after nine months of acquisitions, Statscan said.
Canadians bought C$2.44 billion in foreign securities in November, the biggest amount since June 2007 as they returned to the U.S. government debt market.
Editing by James Dalgleish