(Adds details from report)
OTTAWA, April 17 (Reuters) - Foreign investment in Canadian securities slowed in February as investors increased their holdings of corporate securities but sold federal government bonds, data from Statistics Canada showed on Tuesday.
Non-residents bought a net C$3.96 billion ($3.15 billion) in Canadian securities in the month, down from C$5.63 billion in January.
Investors sold Canadian bonds for the third month in a row for a net decrease of C$897 million as a divestment of government bonds was tempered by purchases of corporate bonds.
Foreigners reduced their holdings of federal government bonds by a record C$12.5 billion following strong investment in the second half of last year. Canadian long-term interest rates were down six basis points in February in the first decline in three months, the statistics agency said.
Investors bought C$2.87 billion in Canadian equities, the largest purchase in five months as foreigners scooped up shares in the finance and insurance sector.
Canadian investment in foreign securities also slowed to a net C$6.35 billion after two months of strong investment. Purchases of foreign stocks cooled to C$4.7 billion, while bond purchases moderated to C$1.58 billion. ($1=$1.2563 Canadian)
Reporting by Leah Schnurr Editing by Bill Trott