Overall BOP position posts $1.27b surplus in August  

September 19, 2018

The overall balance of payments (BOP) position yielded a surplus of $1.27 billion in August, a reversal from the $7 million deficit in the same month last year, the Bangko Sentral ng Pilipinas (BSP) said Wednesday.

Inflows in August stemmed mainly from net foreign currency deposits of the national government and income from the BSP's investments abroad.

These were partially offset, however, by the payments made by the national government for its foreign exchange obligations and foreign exchange operations of the BSP in August.

Despite the August surplus, the cumulative BOP position for January-August registered a deficit of $2.44 billion, higher than the $1.39 billion BOP deficit in the comparable period in 2017.

The higher cumulative BOP deficit for the period may be attributed partly to the widening merchandise trade deficit (based on the Philippine Statistics Authority's preliminary data) from January to July that was brought about by sustained rise in imports of raw materials and intermediate goods as well as capital goods to support domestic economic expansion.

The reported BOP position is consistent with the final gross international reserve level of $77.93 billion as of end-August.

At this level, the GIR represents a more than ample liquidity buffer and is equivalent to 7.1 months' worth of imports of goods and payments of services and primary income. It is also equivalent to 6.4 times the country's short-term external debt based on original maturity and 4.4 times based on residual maturity. DMS