BoP posts $752-M deficit in January

MORE DOLLARS fled the country in January, resulting in a deficit in the balance of payments (BoP) as the country paid off foreign debt obligations, the Bangko Sentral ng Pilipinas (BSP) said.

The BoP posted a $752-million deficit after 11 straight months of surfeit, data released by the BSP on Wednesday evening showed. However, the deficit was smaller than the $1.355-billion gap in January 2020.

“The BoP deficit in January 2021 reflected outflows mainly from the foreign currency withdrawals of the National Government from its deposits in the BSP to pay its foreign currency debt obligations,” the BSP said in a statement.

Data from the Bureau of the Treasury showed the country’s foreign debt stock as of December included loans worth P1.312 trillion and P1.7888 trillion in government securities issued offshore.

Meanwhile, the central bank’s foreign exchange operations and its income sourced from investments abroad partially offset the outflows.

The BoP gives a glimpse of the country’s transactions with the rest of the world at a given time. A deficit means more funds exited the country than what went in, while a surplus shows that more money entered the Philippines.

The January BoP position reflects the country’s gross international reserves (GIR) which stood at $108.67 billion as of endJanuary, which is enough buffer to cover 11.6 months’ worth of imports of goods and payments of services and primary income, the BSP said.

It is also equivalent to 9.4 times of the country’s short-term external debt based on original maturity and five times based on residual maturity.