End-September net external liability position widens
THE Philippines’ net external liability position widened at the end of September due to a decline in the central bank’s reserve assets, the Bangko Sentral ng Pilipinas (BSP) said late Friday.
Preliminary data released by the BSP indicated that the international investment position (IIP) was a net external liability of $50 billion at the end of September, as against a net liability of $49.6 billion at the end of June.
Year on year, the IIP was 62.1% wider against the net external liability of $30 billion a year earlier.
“This development was driven mainly by the 1% contraction in external financial assets, offsetting the 0.7% decline in external financial liabilities,” the BSP said in a statement.
The IIP is an indicator of the value and composition of a country’s financial assets and liabilities. It gauges an economy’s external exposure in financial assets and liabilities.
The central bank reported that external financial assets fell 1% to $227.9 billion at the end of September against $230.3 billion at the end of the previous quarter.
The BSP attributed the decline in financial assets to the combined decreases in reserve assets ($98.1 billion as of September from $99.4 billion as of June), portfolio investments ($32.5 billion from $33.5 billion), and other investments ($26.9 billion from $27.5 billion).
“The lower level of reserves was attributed to the National Government’s payments of its foreign currency debt obligations, coupled with the downward adjustments in the valuation of the BSP’s foreign currency-denominated reserves (or non-gold reserves) and gold holdings,” the BSP said. —