BoP surplus rises to highest in 10 years
The country’s balance of payments (BoP) posted a 10-year high surplus of $3.43 billion in October, bringing the year-to-date tally to more than $10 billion, according to the Bangko Sentral ng Pilipinas (BSP).
Central bank data released on Thursday showed that the amount was wider than the
$2.10-billion and $163-million surpluses a month and a year ago, respectively. It was also the biggest since the $3.95-billion surplus in November 2010.
In a statement, the Bangko Sentral said the October surplus “reflected mainly the BSP’s income from its investments abroad, the national government’s foreign currency deposits with the BSP, and inflows from the BSP’s foreign exchange operations.”
It was partly offset by the government’s foreign debt service, it added.
The latest monthly amount boosted the surplus to $10.31 billion in the first 10 months, higher than the $5.73-billion surplus in the same period in 2019.
The tally is still larger than the BSP’s revised forecast of a $600-million surplus for this year.
“Based on preliminary data, the current BoP surplus was supported mainly by foreign borrowings by the national government and lower merchandise trade deficit, along with sustained net inflows from foreign direct investments (FDI), personal remittances and trade in services,” the Bangko Sentral said.
The Bureau of the Treasury earlier reported that the government’s external obligations rose by 1 percent to P2.93 trillion at end-September.
Latest data from the Philippine Statistics Authority showed that the country’s trade shortfall slid to $16.1 billion in the first nine months of 2020 from $30.5 billion in the same period last year.
Net inflows of FDI in January to August shrank by 5.6 percent to $4.43 billion from $4.69 billion year-on-year. Net receipts posted in trade in services declined by 11.9 percent to $5.2 billion in the first half of the year.
Personal remittances expanded to $24.302 billion in the nine months to September.
The BoP position reflected the final gross international reserves (GIR) level of $103.8 billion as of end-October. GIR are also known as foreign exchange or dollar reserves.
This level “represents a more than adequate external liquidity buffer, which can cushion the domestic economy against external shocks,” the central bank said.
The final GIR is equivalent to 10.3 months’ worth of imports of goods and payments of services and primary income. It is also about nine times the country’s short-term external debt based on original maturity and 5.4 times based on residual maturity.