{"id":72127,"date":"2026-04-13T12:00:32","date_gmt":"2026-04-13T12:00:32","guid":{"rendered":"https:\/\/www.pantheregroup.com\/2026\/04\/13\/posthaste-canadian-dollar-is-being-dumped-from-fx-reserves-at-a-record-pace-whats-going-on\/"},"modified":"2026-04-13T12:00:32","modified_gmt":"2026-04-13T12:00:32","slug":"posthaste-canadian-dollar-is-being-dumped-from-fx-reserves-at-a-record-pace-whats-going-on","status":"publish","type":"post","link":"https:\/\/www.pantheregroup.com\/2026\/04\/13\/posthaste-canadian-dollar-is-being-dumped-from-fx-reserves-at-a-record-pace-whats-going-on\/","title":{"rendered":"Posthaste: Canadian dollar is being dumped from FX reserves at a record pace. What's going on?"},"content":{"rendered":"

\n

\n\"\"<\/p>\n

Global reserve managers appear to have lost their appetite for the <\/p>\n

Canadian dollar<\/p>\n

, according to the <\/p>\n

International Monetary Fund\u2019s<\/p>\n

latest COFER reading. <\/p>\n

COFER, or the Currency Composition of Official Foreign Exchange Reserves, is quarterly IMF data that tracks the global holdings of major currencies. <\/p>\n

The big ones are the U.S. dollar and the euro which account for three-quarters of total FX reserves. However, in recent years the greenback\u2019s share has been declining and in 2025 it touched new lows, said Warren Lovely, an economist with National Bank of Canada. <\/p>\n

Now the Canadian dollar appears to be suffering a similar fate. <\/p>\n

\u201cIn the final quarter of 2025, no identified currency saw its share of the global FX reserve pool trimmed more than CAD \u2026 not even USD,\u201d said Lovely. <\/p>\n

This has happened before. In early 2025, reserve managers also cut Canadian dollar positioning as U.S. President Donald Trump launched a trade war with Canada clearly in his crosshairs. <\/p>\n

Over the whole of last year the Canadian dollar\u2019s share of official reserves\u00a0 dropped 0.34 per cent \u2014 the largest year on year reduction since the loonie was added to the IMF\u2019s reserve currency list, said the economist. <\/p>\n

Translated into dollars, that means holdings fell by $34 billion in the fourth quarter alone and by $53 billion over the year. <\/p>\n

\"\"<\/p>\n

\u201cThis is unprecedented stuff, the 11 per cent year-on-year reduction in local currency terms steeper\/deeper than for any other reserve currency,\u201d said Lovely. <\/p>\n

COFER tracks five currencies beyond the three already mentioned including the pound sterling, Swiss franc, Australian dollar, Japanese yen and Chinese renminbi. Another category of \u201cother currencies\u201d serves as a catch-all. <\/p>\n

By the end of 2025 Canada\u2019s share of reserves was down to 2.49 per cent, ranking it fifth among the currencies the IMF reports on. \u201cOther currencies,\u201d meanwhile, captured a larger share of reserves, growing to 6 per cent. <\/p>\n

Lovely said Canada\u2019s uncertain outlook as a \u201csmall, open economy dependent on a protectionist America,\u201d may be working against the loonie, but here\u2019s another puzzle. <\/p>\n

Despite the divestment recorded by the IMF, data from Statistics Canada show foreign investors remain keen on Canada. <\/p>\n

\u201cWhile not the first time the IMF and StatCan data painted conflicting pictures, the Q4 gap between CAD reserves divestment (IMF) and broader foreign buying of domestic debt (StatCan) was unprecedented. Peculiar,\u201d he said. <\/p>\n

Statistics Canada reports that non-residents added Canadian dollar-denominated debt right into 2026, providing a more timely picture than the IMF\u2019s data. <\/p>\n

\u201cSo if FX reserves managers really did get cold feet in 2025, at least alternative sources of demand for Canadian debt were located,\u201d said Lovely. <\/p>\n

\u201cThe implication: Non-resident positioning in Canada\u2019s domestic debt market skewed towards \u2018unofficial\u2019 asset managers more than ever before, where the use of leverage creates scope for enhanced volatility.\u201d <\/p>\n

The Iran conflict may turn the tide, said the economist. As a resource-rich nation with a \u201cfresh, pro-growth federal agenda,\u201d Canada may once again gain favour among the \u201cofficial\u201d FX reserve managers. <\/p>\n

\n

\u00a0Sign up here to get Posthaste delivered straight to your inbox.<\/strong><\/em> <\/p>\n

\n


\"\"<\/strong> <\/p>\n

\"\"<\/p>\n

\u00a0 <\/p>\n

Inflation in the United States soared in March in a spike \u201creminiscent of the 1970s\u201d \u2014 the first sign that the war in the Middle East is rippling through the economy. <\/p>\n

A record increase in gas prices was responsible for nearly three-quarters of the advance, while core measures that exclude food and energy costs increased at a slower pace. <\/p>\n

Prices for goods in trade-exposed sectors such as auto parts, apparel, personal and recreational products also continue to rise \u201cat an uncomfortable pace,\u201d said <\/p>\n

economists at the Royal Bank of Canada. <\/p>\n

And that inflation could get even hotter if the oil shock persists and forces up prices for fertilizers and transportation. <\/p>\n

\u201cEven if a long-lasting deal to end the war is reached and the Strait of Hormuz is fully re-opened, it would take months for oil, gasoline, diesel and other commodity supplies to snap back to pre-war levels,\u201d said Kathy Bostjancic, chief economist at Nationwide. <\/p>\n

\"\"<\/p>\n

Today\u2019s data:<\/strong><\/p>\n

Canada building permits, United States existing home sales <\/p>\n

Earnings:<\/strong><\/p>\n

Goldman Sachs Group Inc. <\/p>\n

\n

\"\"
\n\"\"<\/p>\n

\u00a0 <\/p>\n

<\/figure>\n
\n

\"\"<\/strong> <\/p>\n

    \n
  • 5 reasons to stay with your current lender at renewal time \u2014 and a few reasons you should run<\/li>\n
  • Canada pushes to join U.K.-Italy-Japan advanced fighter jet project<\/li>\n
  • This creative money transfer strategy among family members could raise red flags with CRA<\/li>\n<\/ul>\n

    \"\" <\/p>\n

    A garden project can be one of the more satisfying ways to invest in a home, but before your shovel hits the ground, it is worth planning the project with a clear budget, a practical purpose and a realistic sense of return. Credit counsellor Mary Castillo offers some tips on indulging your green thumb without letting costs get out of control. <\/p>\n

    Find out more <\/p>\n

    \n

    <\/span>
    \n\"\"<\/p>\n

    Interested in energy? The subscriber-only FP West: Energy Insider newsletter brings you exclusive reporting and in-depth analysis on\u00a0 one of the country\u2019s most important sectors. <\/p>\n

    Sign up here. <\/p>\n

    \n
    Are you worried about having enough for retirement? Do you need to adjust your portfolio? Are you starting out or making a change and wondering how to build wealth? Are you trying to make ends meet? Drop us a line at\u00a0<\/span>wealth@postmedia.com<\/span>\u00a0with your contact info and the gist of your problem and we\u2019ll find some experts to help you out while writing a Family Finance story about it (we\u2019ll keep your name out of it, of course).<\/span><\/div>\n
    \n

    McLister on mortgages<\/h2>\n

    Want to learn more about mortgages? Mortgage strategist Robert McLister\u2019s <\/p>\n

    Financial Post column <\/p>\n

    can help navigate the complex sector, from the latest trends to financing opportunities you won\u2019t want to miss. Plus check his <\/p>\n

    mortgage rate page<\/p>\n

    for Canada\u2019s lowest national mortgage rates, updated daily. <\/p>\n

    \n

    Financial Post on YouTube<\/h2>\n

    Visit the Financial Post\u2019s <\/p>\n

    YouTube channel<\/p>\n

    for interviews with Canada\u2019s leading experts in business, economics, housing, the energy sector and more. <\/p>\n

    \n

    Today\u2019s Posthaste was written by Pamela Heaven with additional reporting from Financial Post staff, The Canadian Press and Bloomberg.<\/em> <\/p>\n

    Have a story idea, pitch, embargoed report, or a suggestion for this newsletter? Email us at\u00a0<\/p>\n

    posthaste@postmedia.com<\/p>\n

    . <\/p>\n

    \n
      \n
    • More Canadians desperate for tax refund to plug holes in their finances<\/li>\n
    • How the U.S. dollar stole the Canadian dollar’s petrocurrency thunder<\/li>\n<\/ul>\n

      Bookmark our website and support our journalism:<\/strong> Don\u2019t miss the business news you need to know \u2014 add\u00a0financialpost.com\u00a0to your bookmarks and sign up for our newsletters here<\/em> <\/p>\n

      <\/img>
      \n
      \n
      Posthaste: Canadian dollar is being dumped from FX reserves at a record pace. What's going on?<\/a>
      \n
      2026-04-13 12:00:32<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

      Global reserve managers appear to have lost their appetite for the Canadian dollar , according to the International Monetary Fund\u2019s latest COFER reading. COFER, or the Currency Composition of Official…<\/p>\n","protected":false},"author":2,"featured_media":72128,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[31],"tags":[],"class_list":{"0":"post-72127","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy"},"_links":{"self":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts\/72127","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/comments?post=72127"}],"version-history":[{"count":0,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts\/72127\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/media\/72128"}],"wp:attachment":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/media?parent=72127"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/categories?post=72127"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/tags?post=72127"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}