Better BSP investments income swells January BOP surplus to $2.704B

THE Philippine economy started the year with billions of dollars in balance of payments (BoP) surplus in 2019, the Bangko Sentral ng Pilipinas (BSP) reported late Tuesday, as the local currency gained traction against the dollar.

Data from the Central Bank showed the country’s BoP—or the summary of the country’s transactions with the rest of the world— started 2019 with $2.704 billion in surplus.

This is a reversal of the deficit seen in end-2018, which was at $2.306 billion. It is also better than the $531-million deficit seen in the same month last year.

The BSP attributed the surplus to better conditions in the Central Bank’s investments income during the month.

“Inflows in January 2019 stemmed mainly from the national government’s [NG] net foreign currency deposits, BSP’s foreignexchange operations and income from its investments abroad,” the BSP said in a statement.

“The net inflows in foreign portfolio investments [net BSPregistered transactions based on custodian banks’ reports] contributed partly to the BoP surplus recorded in January 2019,” it added.

The peso gained traction against the dollar during the month, with its average trade hitting 52.4679 against the dollar, appreciating by about a fifth of a peso against the 2018 average of 52.6614 to a dollar.

The BSP said the surplus during the period could have been higher, if not for offsetting factors during the period. These offsetting factors were payments made by the national government for its foreign exchange obligations during the month in review.