As reported by the Federal Finance Department, Canada’s official international reserves saw a significant rise of $2.84 billion in December. The country’s total reserves of foreign currencies and other monetary assets reached $118.28 billion by the end of December, marking an increase from $115.44 billion the previous month.
No Intervention or Gold Holdings
During November, the government did not intervene in the foreign-currency market, and there were no gold holdings at the end of the month. All reserve figures are reported in U.S. dollars.
Canada Bills Outstanding Increase
The finance department also revealed that the amount of outstanding Canada bills increased by $626 million to $3.35 billion in December. These bills are short-term securities sold on the U.S. money market.
Composition of Foreign-Currency Reserves
As of December 29, Canada’s foreign-currency reserves consisted of various components:
- Securities: $87.71 billion
- Deposits: $8.20 billion
- Special Drawing Rights: $23.42 billion
- Reserve Position in the International Monetary Fund: $4.22 billion
Factors Contributing to the Increase in Reserves
The $2.84 billion net increase in reserves in December was attributed to several factors:
- Reserves management operations saw an increase of $466 million.
- Return on investments rose by $1.86 billion.
- Foreign-currency debt charges decreased by $159 million.
- Revaluation effects showed an increase of $668 million.
- No net government operations were reported.
- Official intervention was not reported.
Currency Composition
The currency composition of deposits and securities as of December 29 consisted of the following:
- U.S. dollars: $63.64 billion
- Euro: $11.98 billion
- Pound sterling: $9.08 billion
- Yen: $5.21 billion
