Hot money returns in July — BSP
MANILA, Philippines — More flighty foreign funds entered the Philippines in July amid renewed investor optimism fueled by easing inflation and positive outlook on the local currency, the Bangko Sentral ng Pilipinas reported Thursday.
Foreign portfolio investment transactions in July yielded net inflows of $15 million, a reversal from the $35 million net outflow recorded in June.
The central bank attributed this to “better-than-expected inflation data for the month of June coupled with easing domestic inflation for the second quarter of 2019, and stronger peso forecast.”
The so-called hot money enters and exits the country with ease, unlike firmer commitments like foreign direct investment.
Gross inflows in July amounted to $1.7 billion, up 19% from $1.4 billion registered in the previous month. On the other hand, foreigners pulled out $1.7 billion of short-term funds, 15.1% higher than $1.4 billion withdrawn in June.
According to the BSP, 76.5% of investments in July went to shares of listed companies while 23.5% were placed on peso-denominated securities. The United Kingdom, Hong Kong, the United States, Norway and Malaysia were the top five investor countries for the month.
Meanwhile, the US received 77.8% of total outflows.
Despite the uptick in hot money in July, the Philippines saw a net outflow of $671.5 million year-to-date.
- Latest
- Trending