BoP surplus widens to $627M in March
Credit to Author: MAYVELIN U. CARABALLO, TMT| Date: Wed, 17 Apr 2019 16:17:33 +0000
THE country’s balance of payments (BoP) position remained positive in March, the Bangko Sentral ng Pilipinas (BSP) reported on Wednesday.
The $627-million result — higher than February’s $467-million — was a reversal from the $266-million deficit recorded a year earlier and also boosted the first quarter tally.
The January-March balance was a $3.797-billion surplus, also a turnaround from the $1.227-billion deficit recorded a year earlier.
“Inflows in March 2019 stemmed mainly from the national government’s net foreign currency deposits and the BSP’s foreign exchange operations and income from its investments abroad,” the central bank said in a statement.
These were partially offset by the payments made by the national government for foreign exchange obligations.
The first quarter surplus, meanwhile, “may be attributed partly to remittance inflows from overseas Filipinos and net inflows of foreign portfolio investments (net BSP-registered transactions based on custodian banks’ reports) for the first two months of the year, and net inflows of foreign direct investments in January 2019,” the Bangko Sentral said.
Personal remittances totaled $5.302 billion in January-February, 2.3 percent higher than the $5.182 billion posted a year earlier.
Foreign portfolio investments, meanwhile, posted a $762.82-million net inflow in January before narrowing to $339.57 million in February.
Net foreign direct investments, lastly, hit $609 million in January, down 38.2 percent from $986 million in the same month last year and the lowest since November 2018’s $535 million.
“The positive BoP is a sign that some foreign portfolio investor confidence has been regained after last year’s inflation episode drove them out,” BPI lead economist Emilio Neri Jr., Bank of the Philippine Islands vice president and lead economist, said.
Inflation averaged 5.2 percent in 2018, exceeding the government’s 2-4 percent target.
“The return of a positive capital and financial account helps the BSP to rebuild its GIR (gross international reserves) even as the economy continues to incur investment-
led current account deficits,” Neri added.
The central bank has forecast a $3.5-billion BoP deficit for 2019.
The BoP ended at a deficit of $2.306 billion last year, wider than the $863 million recorded in 2017 but lower than BSP’s $5.5-billion forecast.
Its main component — the current account — hit an all-time $7.9-billion deficit last year as robust economic activity resulted in a wider trade gap.
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