BOP FALLS TO $604M IN OCTOBER

THE country’s Balance of Payments (BOP) fell to $604 million in October 2012 or $147 million down from the recorded figure in September.

However, data from the Bangko Sentral ng Pilipinas (BSP) showed that the BOP, or the country’s summary of economic transactions, made significant gains compared to the $208 million recorded during the same month last year.

On a year- to- date comparison, the BOP, however, dropped to $ 6.435 billion in October 2012 compared to the $9.929 billion of the same period last year.

The BSP earlier said that it will modify this year’s forecast for the country’s gross international reserves, as part of the review of its BOP assumptions.

The review of the central bank’s BOP assumptions comes as the Philippines enjoys huge inflows of foreign portfolio investment—socalled hot money—brought about by the weakness in advanced economies, leading investors to search for yields higher than are available in those markets.

However, the National Statistical Coordination Board earlier said that foreign direct investment (FDI) in the BOP, as compiled by the BSP, recorded net inflows of $67 million in the second quarter of 2012, a decrease of 80.1 percent from $273 million recorded in the same period last year.

BOP-FDI covers cash transactions on FDI flows that are coursed through the banking system.