More ‘hot money’ left in July

More “hot money” left the country in July, although net outflows of foreign portfolio investments that month were the lowest in three months.

Data released by the Bangko Sentral ng Pilipinas (BSP) Friday showed that net outflows reached $160.1 million last month, a reversal of the $321.8 million in net inflows a year ago. Net outflows meant more investments in bonds, deposits and stocks left the country than what went in.

July’s net outflows were nonetheless lower than June’s $522 million and May’s $569.3 million.

Inflows last July amounted $1.43 billion, the lowest monthly figure since January last year’s $1.28 billion. The BSP explained that “the imminent interest rate hike in the US weighed down on investor sentiment” that month. A rate adjustment by the US Federal Reserve is expected in September.

The bulk or 75.4 percent of the investments that came in at the start of the second half were in Philippine Stock Exchange (PSE)-listed securities, 24 percent in peso-denominated government securities and 0.6 percent in peso time deposits and other debt instruments.

Outflows, meanwhile, reached $1.59 billion in July. “[N]et outflows were recorded for PSE-listed securities ($159 million) and other peso debt instruments ($11 million),” the BSP said.