The country’s balance of payments posted a surplus of $467 million in April, a reversal of the $270-million deficit recorded a year ago, buoyed by remittances, foreign direct investments and income from the investments of the Bangko Sentral ng Pilipinas abroad.
Data from the BSP showed the figure brought the cumulative BoP position in January to April to a surplus of $4.27 billion, a turnaround from the $1.5-billion deficit registered in the first four months of 2018. The BoP posted a surplus of $2.7 billion in January.
The BSP said another factor that supported the overall BoP position was the net foreign currency deposits of the national government.
“These were offset partially, however, by the payments made by the national government for its foreign exchange obligations during the month in review,” it said.
It said the surplus could 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] in the first quarter and net inflows of foreign direct investments in first two months of 2019.
Cash remittances rose 4.2 percent in the first quarter to $7.3 billion from a year ago. Net inflows of FDIs reached $1.4 billion in the first two months while foreign portfolio investments yielded net inflows of $363 million in the first quarter.
The BoP position reflected the final gross international reserves level of $83.88 billion as of end-April 2019. At this level, the GIR was equivalent to 7.4 months’ worth of imports of goods and payments of services and primary income.
It was also equivalent to five times the country’s short-term external debt based on original maturity and 3.5 times based on residual maturity.
The BoP summarizes the country’s economic transactions with the rest of the world, with a surplus indicating that foreign exchange inflows exceeded foreign exchange payments.
Persistent surpluses help build up the GIR, an ample supply of which helps prop up the peso against the US dollar and keep domestic inflation at bay.
The country’s BoP position ended 2018 with a deficit of $2.31 billion, pulled down by the widening trade deficit.
The Bangko Sentral was expecting the BoP to incur a deficit of $3.5 billion in 2019, equivalent to 1 percent of the gross domestic product. The current account, a component of BoP, is projected to register a deficit of $8.4 billion this year.