Foreign portfolio investments yield net inflows in September: central bank

October 12, 2017

Registered foreign portfolio investments for September reached $1.30 billion, higher by 38.5 percent and 1.8 percent than the $936 million and $1.27 billion recorded in August and September last year, the Bangko Sentral ng Pilipinas said Thursday.

This may be attributed to investor reaction to the extension of the debt limit deadline in the United States (US), and the Philippine Senate’s approval of the first package of the government’s tax reform program, the central bank said.

About 80.9 percent of investments registered in September were in PSE-listed securities (pertaining mainly to holding firms, property companies, banks, casinos and gaming firms, food, beverage and tobacco companies); 18.7 percent went to peso government securities , and the 0.4 percent balance to peso time deposits .

Transactions in PSE-listed securities resulted in net outflows of $42 million, while investments in peso government securities and peso time deposits yielded net inflows of $150 million and $5 million, respectively.

The United Kingdom, the US, Singapore, Norway, and Luxembourg were the top five investor countries for the month, with combined share to total of 79.4 percent.

Outflows for the month of $1.2 billion were 19.1 percent higher compared to the $994 million level in August, while the reverse was noted year-on-year, as outflows declined by 43.1 percent from $2.1 billion.

The US continued to be the main destination of outflows, receiving 79.1 percent of total remittances.

On the overall, transactions for the month yielded net inflows of $113 million, a reversal from the net outflows recorded in August ($58 million) and September last year ($807 million).

Year-to-date transactions (2 January to 29 September 2017) resulted in net outflows of $206 million, in contrast to the net inflows of $1.3 billion for the comparative period last year (4 January to 30 September 2016), due to certain domestic and international developments (including the interest rate hikes by the US Federal Reserve, global terrorist attacks, North Korea’s nuclear missile testing and the closure order for several mining companies in the country) earlier in the year. DMS