THE country’s balance of payments (BoP) surplus ballooned to $3.5 billion in September, the Bangko Sentral ng Pilipinas (BSP) reported late Friday.
It surged from $88 million a month earlier and reversed from the $414-million deficit recorded a year earlier.
“The BoP surplus… reflected inflows mainly from the national government’s net foreign currency deposits with the Bangko Sentral ng Pilipinas and net income from the BSP’s investments abroad,” the central bank said in a statement.
Year to date, the country’s BoP position remained in surplus at $5.1 billion, higher than the $1.7 billion recorded in January-September 2023.
This was mainly due to “narrowing trade in goods deficit alongside the continued net inflows from personal remittances, trade in services, and net foreign borrowings by the NG,” the BSP said.
“Furthermore, net foreign direct and portfolio investments contributed to the BoP surplus,” it added.
The country’s gross international reserves (GIR), meanwhile, increased to $112.7 billion as of end-September from $107.9 billion a month earlier, the central bank also reported.
The level was said to represent “a more than adequate external liquidity buffer equivalent to 8.1 months’ worth of imports of goods and payments of services and primary income.”
“It is also about 4.5 times the country’s short-term external debt based on residual maturity,” the BSP added.
Sought for comment, Rizal Commercial Banking Corp. chief economist Michael Ricafort said the BoP and GIR gains were partly due to growth in structural dollar inflows, including remittances, business process outsourcing revenues, exports, foreign investments and tourism.
“For the coming months, BoP data could still improve with the continued increase in the country’s structural inflows as the economy recovers further,” he added.
The BSP expects the country to post a BoP surplus this year and the next. It raised the projections for 2025 and 2025 last month, citing positive outlooks for economic growth, inflation, and world trade.
“The latest set of forecasts indicate an improvement in the overall balance of payments position for 2024 and 2025 relative to the June 2024 projection exercise,” it said on September 20.
“This development is underpinned mainly by the sustained positive global and domestic economic growth prospects, decelerating inflation, as well as the pickup in world trade activity,” it added.
The 2024 BoP surplus projection was raised to $2.3 billion from $1.6 billion, while that for 2025 edged up to $1.7 billion from $1.5 billion.
The BoP is a summary of a country’s transactions with the rest of the world for a specific period. It consists of the current account, which covers trade in goods, services, and primary and secondary income (which includes overseas Filipino worker remittances); the capital account — capital transfers and nonfinancial assets — and the financial account, which consists of investments from abroad.
The country recorded a BoP surplus of $3.7 billion last year.
As for GIR, the BSP also raised its forecasts for this year to $106 billion from $104 billion. That for 2025 was also hiked to $107 billion from $105 billion.
The revised BoP forecasts, the BSP said last month, come with limitations given a continued buildup in external challenges.
“The BSP will continue to monitor closely emerging external sector developments and risks and how these may impact the BSP’s fulfillment of its price and financial stability objectives,” the central bank added.
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