Philippines BOP posts $1.5 billion surplus in October

The Philippines posted a balance of payments surplus of $1.5 billion in October 2023, up from $711 million in the same month last year, according to the Bangko Sentral ng Pilipinas (BSP).

It was the highest BOP surplus since January when it hit $3.1 billion.

“The BOP surplus in October 2023 reflected inflows arising mainly from the national government’s net foreign currency deposits with the Bangko Sentral ng Pilipinas, and the BSP’s net foreign exchange operations and net income from its investments abroad,” the BSP said in a statement.

The latest surplus brought the year-to-date level to $3.2 billion, a reversal from the $7.1-billion deficit recorded in the same period last year.

“Based on preliminary data, this development reflected mainly the improvement in the balance of trade alongside the higher net inflows from personal remittances, trade in services and foreign borrowings by the national government,” the BSP said.

The peso also strengthened Monday to close at 55.55 against the US dollar from 55.67 Friday.

Net inflows from foreign direct investments contributed to the surplus, albeit lower during the period, the BSP said.

The gross international reserves level increased to $101.0 billion as of end-October from $98.1 billion in September. The latest GIR level represented a more than adequate external liquidity buffer equivalent to 7.5 months’ worth of imports of goods and payments of services and primary income.

It was also about 5.8 times the country’s short-term external debt based on original maturity and 3.7 times based on residual maturity.

The BSP earlier reduced its BOP deficit projection this year to $0.1 billion from an estimate of $1.2-billion shortfall made in the second quarter.

The Monetary Board approved the new set of 2023 and 2024 balance of payment projections during its Sept. 14, 2023 meeting.

The current account is expected to post a deficit of $11.1 billion this year from the previous estimate of $15.1-billion shortfall.