Net inflows of ‘hot money’ posted in Feb.

investor interest in peso government securities as well as shares offered by two holdings firms.”

As for outflows last February, these increased by 6.4 percent to more than $1 billion from the previous month’s $950.3 million “due to profit taking, lingering concerns on the slowdown of the Chinese economy and oil price uncertainties,” the BSP explained.

On a year-on-year basis, outflows dropped 25.6 percent from $1.4 billion in the same month last year.

More than three-fourths or 77.1 percent of the foreign portfolio investments last month were in Philippine Stock Exchange (PSE)-listed securities, mostly invested in banks; food, beverage and tobacco firms; holding firms; property companies, and telecommunication firms.

According to the BSP, transactions in PSE-listed securities in February yielded a net outflow worth $57 million, while those for peso government securities had a net inflow of $115 million.

Foreign portfolio investments are in the form of placements in publicly listed shares, government and private sector IOUs as well as deposit certificates. Portfolio investments are con- sidered short-term bets—hence the monicker “hot money”—because these placements may be pulled out quickly.

BSP data showed that the US was among the top five sources of registered portfolio investments last February, although it was also the main destination of outflows.

“American investors want more supply from the Philippines. Since yields of [US treasury] securities are very tight, it’s now very expensive if they buy from the secondary market,” National Treasurer Roberto B. Tan said in an interview.