BOP surplus falls on year in Jan. But foreign reserves at record high
Chino S. Leyco
Manila Times
BUOYED by strong remittances from overseas Filipino workers and foreign investments, the Philippines balance of payments posted another surplus last month, the Bangko Sentral ng Pilipinas said Monday.
BSP Governor Amando M. Tetangco Jr. said the headline BOP in January registered a surplus of $216 million, lower than the $731-million surplus year on year and the $794 million in the previous month.
“The $216-million BOP surplus in January was due to continued [foreign exchange] inflows, including higher BSP investment income, dollar deposits … and other current and capital account transactions,” Tetangco said.
The BOP surplus in January to December last year reached $8.58 billion, but the central bank forecasts a much lower surplus of $3.4 billion this year.
As a result of a higher dollar surplus, the country’s gross international reserves posted a record high of $34.4 billion at end-January this year, exceeding by $600 million the end-December $33.8 billion.
At end-Novermber, cumulative foreign direct investments net inflows reached $1.9 billion, or 33.8 percent higher than the registered $1.4 billion during the same period a year ago.
Due to the increase, the actual FDI net inflows for January to November remained on track relative to the central bank’s forecast of $2.1 billion for the whole year.
Overseas Filipino remittances coursed through banks, meanwhile, increased 13.2 percent year on year to $14.4 billion last year from P12.8 billion a year ago. It was also higher than the forecast $14.3 billion.
Remittances accounted for about 10 percent of nominal gross domestic product last year.
In December alone, remittance volume reached $1.4 billion in December, the highest monthly level on record.
The central bank said monthly remittances have been surpassing the billion-dollar level since May 2006.
Moreover, global liquidity has recovered and flowed back into emerging markets like the Philippines after the US Federal Reserve Board decided to cut interest rates.
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