BOP deficit swelled to $895M in Feb

MANILA  – The Philippines incurred a balance of payments deficit of $895 million (BOP) in February, about six times the $157-million deficit posted in the same month last year, according to the Bangko Sentral ng Pilipinas (BSP).

At the same time, the BSP’s gross international reserves (GIR) decreased to $98.2 billion, which was even lower than the $99.31 billion that was earlier estimated for the month.

“The BOP deficit in February 2023 reflected outflows arising mainly from the national government’s net foreign currency withdrawals from its deposits with the BSP to settle its foreign currency debt obligations and pay for its various expenditures,” the central bank said in a statement.

On the other hand, the latest monthly readout brought the cumulative BOP so far this year to a surplus of $2.2 billion, covering January and February.

In January alone, the BOP swung to a surplus of $3.08 billion from a deficit of $102 million in the same month of 2022.

The two-month BOP surplus was a turnaround from a deficit of $259 million for the same period last year.

“Based on preliminary data, the cumulative BOP surplus reflected inflows that stemmed mainly from the global bond issuance of the NG in January 2023, personal remittances, and foreign portfolio investments,” the BSP said.

Last January, the government raised $3 billion as planned from a three-tranche issuance of global bonds. Meanwhile, personal remittances from Filipinos who are based abroad reached $3.07 billion, while short-term investments showed a net inflow of $292 million.

As for the GIR, it represented 7.4 months’ worth of imports of goods and payments of services and primary income.

The BSP’s reserves were also about 5.9 times the country’s short-term external debt based on original maturity and 3.9 times based on residual maturity. INQ

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