03/18/2013 02:06 EDT | Updated 05/18/2013 05:12 EDT

Canadians dump foreign bonds

Following four straight months of increased investments, Canadians reduced their holdings of foreign stocks and bonds by more than $1.2 billion.

Statistics Canada data released Monday showed Canadians dumped more than $3.3 billion worth of foreign bonds during the month. That includes more than $6 billion of U.S. government bonds, more than offsetting a cumulative $10.4 billion worth of American bonds that they had accumulated during the previous three months.

Foreign stocks, however, proved more popular, as Canadians bought more than $2.2 billion worth. It was the fifth straight month of acquisitions and focused mainly on U.S.-listed stocks, which went up by an average of five per cent during the month.

Foreigners buy Canadian stocks and bonds

On the flip side of Canadians' bond sell-off, foreigners were gobbling up Canadian stocks and bonds in record numbers during the month.

All in all, non-resident investors acquired $13.3 billion worth of Canadian securities in January, with a focus on bonds. Indeed, the focused switched away from low-yielding government bonds, and toward corporate debt.

Foreigners bought $10.3 billion worth of private corporate debt instruments in January, the highest amount since October 2001. At the same time, they sold off $4.3 billion worth of Canadian government debt.

Non-Canadian investors bought $1.7 billion worth of Canadian stocks in January, a month that saw the average Canadian share price increase by two per cent.