$459 M hot money flows out in March

The Philippine Star - - BUSINESS - By MARY GRACE PADIN

For­eign port­fo­lio in­vest­ments or hot money flowed out of the coun­try in March as in­vestors were driven away by con­tin­ued un­cer­tain­ties, such as the an­tic­i­pated rate hike in the US and the tri­als faced by the lo­cal min­ing in­dus­try.

Lat­est data from the Bangko Sen­tral ng Pilip­inas (BSP) showed that hot money for March reg­is­tered a net out­flow of $459.86 mil­lion, widen­ing from a $409 mil­lion net out­flow posted in Fe­bru­ary.

This was also a rev­er­sal of the net in­flow of $482.43 mil­lion recorded in the same month last year.

The BSP said to­tal out­flows amounted to $1.83 bil­lion, out­pac­ing the $1.37 bil­lion in­flows dur­ing the month.

For the first three months, the net out­flow of port­fo­lio in­vest­ments reached $567.54 mil­lion, also a turn­around from the $396 mil­lion in net in­flow recorded in the same pe­riod in 2016.

For­eign port­fo­lio in­vest­ments or hot money are re­ferred to as spec­u­la­tive funds con­trolled by in­vestors who ac­tively seek short-term re­turns and high in­ter­est rate in­vest­ment op­por­tu­ni­ties.

“(The net out­flow) is at­trib­ut­able mainly due to profit tak­ing and con­tin­ued un­cer­tain­ties aris­ing from in­ter­na­tional and do­mes­tic de­vel­op­ments,” the BSP said.

Th­ese de­vel­op­ments in­clude the US in­ter­est rate hike and the clo­sure and sus­pen- sion or­ders on lo­cal min­ing com­pa­nies is­sued by En­vi­ron­ment Sec­re­tary Gina Lopez.

Ac­cord­ing to BSP data, port­fo­lio in­vest­ment in­flows reached $1.37 bil­lion in March, 19 per­cent lower than the $1.69 bil­lion recorded last year.

It was, how­ever, 40 per­cent higher than the $981.2 mil­lion in port­fo­lio in­vest­ment recorded in Fe­bru­ary this year.

“(This was) due to the much an­tic­i­pated in­ter­est rate in­crease by the (US Fed) and the BSP’s de­ci­sion to main­tain the in­ter­est rate on the overnight re­verse re­pur­chase fa­cil­ity at three per­cent,” the BSP said.

About 84 per­cent of in­vest­ments in March were se­cu­ri­ties from the Philip­pine Stocks Ex­change (PSE), while the rest went to govern­ment se­cu­ri­ties and unit in­vest­ment trust funds (UITF).

Top sources of in­vest­ments dur­ing the pe­riod were the United King­dom, US, Sin­ga­port, Bel­gium and Switzer­land.

The BSP said both PSElisted se­cu­ri­ties and govern­ment se­cu­ri­ties reg­is­tered a net out­flow of $320 mil­lion and $158 mil­lion, re­spec­tively, while net in­flows of $18 mil­lion were noted for UITFs.

Newspapers in English

Newspapers from Philippines

© PressReader. All rights reserved.