MANILA, Philippines — The country’s balance of payments (BOP) position remained in a surplus for the third straight month and hit an almost four-year high of $3.5 billion in September on the back of net income from investments abroad.
Latest data from the Bangko Sentral ng Pilipinas (BSP) showed a $3.53-billion surplus in the September BOP, a marked reversal from the $414-million deficit in the same period last year.
It marked the third straight month of BOP surplus or since hitting $62 million in July.
Similarly, the September BOP is also the largest in almost four years or since the $4.24 billion logged in December 2020.
According to the BSP, the September BOP surplus is a reflection of the inflows from the government’s net foreign currency deposits with the BSP and net income from the central bank’s investments abroad.
The BOP is the difference in total values between payments into and out of the country over a period. It is also a measure of the country’s cash flow statement with the rest of the world.
A surplus means more dollars flowed into the country from exports, remittances from overseas Filipino workers, business process outsourcing earnings and tourism receipts than what flowed out to pay for the importation of more goods, services and capital.
As of end-September, the country’s BOP position stood at a surplus of $5.12 billion, almost triple the $1.74 billion excess recorded in the same period last year.
According to the central bank, this is mainly due to the narrowing trade in goods deficit alongside the continued net inflows from personal remittances, trade in services and net foreign borrowings by the government.
Likewise, net foreign direct and portfolio investments contributed to the BOP surplus.
Data showed that the country’s trade deficit amounted to $34.3 billion from January to August, four percent lower than the $35.86 billion recorded in the same period last year.
This as Philippine imports in the eight-month period dipped slightly to $83.7 billion while exports went up by 2.3 percent to $49.41 billion.
Further, the BSP reported that the country’s gross international reserves level increased to $112.7 billion as of end-September from $107.9 billion in end-August.
The central bank maintained that the foreign exchange buffer represents a more than adequate external liquidity buffer equivalent to 8.1 months’ worth of imports of goods and payments of services and primary income.
It is also about 4.5 times the country’s short-term external debt based on residual maturity.