A couple of weeks ago, we learned that Canada had a near-record $9.3b current account surplus in 2005Q3. Today, Statistics Canada announced that the net investment position deteriorated by $17b over the same period.
The reason, of course, is the continuing rise of the CAD:
The value of international assets fell to $1,001.1 billion, a $5.6 billion decline from the end of the second quarter. The dollar, which gained 5.4% against its US counterpart during the quarter, removed $46.3 billion from the value of these assets, which offset all net transactions.
At the same time, Canada's international liabilities increased by $11.6 billion to $1,171.4 billion. The strengthening dollar removed $22.3 billion from the position, but the net transactions of $38.2 billion more than offset this effect.
As a result, net external liabilities represented 12.3% of Canada's gross domestic product at the end of the third quarter, up from 11.4% in the previous quarter.