Canada launched its first $250 million dollar bond sale in more than three years, in a bid to counterbalance some of the stigma raised by the first flu pandemic to hit the country in nearly a century.
The sale on Tuesday comes more than four months after China and Canada signed a global deal that will allow the two countries to exchange rare and sensitive market data. It also comes after banks across the country rounded up applications for initial public offerings that could have raised as much as $1 billion.
Canada has said its move to use the two-year CD “could also help the [dollar] appreciate.” If the pound, the euro and the franc all weaken further than their counterparts against the Canadian dollar, the country’s FX reserves would grow accordingly, according to a Bank of Canada presentation.
Surprisingly the first Canadian dollar bond sale since the first global trade war in 2010 flopped. The offering was part of a plan to improve data reliability at the central bank to better serve its clients. To win over investors, the central bank settled on interest rates and foreign exchange rates to use when compiling bonds for more than a year.
By Mark Hosenball / Bloomberg