Overall BOP position posts a deficit of $458 million in October  

November 19, 2018

The country's overall balance of payments (BOP) position posted a deficit of $458 million in October, higher than the $368 million BOP deficit recorded in the same month last year, the Bangko Sentral ng Pilipinas ( BSP) said Monday.

Outflows in October stemmed mainly from payments made by the National Government (NG) for its foreign exchange obligations, national government's net foreign currency withdrawals and foreign exchange operations of the BSP. These were partially offset, however, by the BSP's income from its investments abroad, the central bank said.

On a cumulative basis, the BOP registered a deficit of $5.59 billion during the period January-October.

The higher deficit may be attributed partly to the widening merchandise trade deficit (based on the Philippine Statistics Authority's preliminary data) for the first three quarters of the year. This, in turn, was brought about mainly by the sustained rise in imports of raw materials and intermediate goods as well as capital goods to support domestic economic expansion.

The reported BOP position reflected the final gross international reserves level of $74.71 billion as of end-October.

At this level, the gross international reserves represent a more than ample liquidity buffer and is equivalent to 6.8 months' worth of imports of goods and payments of services and primary income. It is also equivalent to 5.7 times the country's short-term external debt based on original maturity and 3.9 times based on residual maturity. DMS