By Lee C. Chipongian
The central bank reported a balance of payments (BOP) surplus of $448 million for the month of March, slowing down the end-first quarter deficit to $68 million as a result of the excess.
Based on Bangko Sentral ng Pilipinas (BSP) data, the March surplus of $448 million is lower than same time last year of $627 million and also lower than February’s $839 million.
“The BOP surplus in March reflected mainly the inflows arising from the BSP’s foreign exchange operations as well as income from its investments abroad, and the National Government’s (NG) foreign currency deposits with the BSP,” the BSP said in a statement. “These inflows were partially offset, however, by the foreign currency withdrawals made by the NG to pay its foreign currency debt obligations during the month in review.”
The end-March BOP deficit of $68 million, in the meantime, is better than end-February’s $516 million and January’s $1.355 billion shortfall. Compared to March 2019, the current deficit is also smaller from $3.797 billion.
The BSP said the lower cumulative deficit “may be attributed partly to the reversal of foreign portfolio investments to net outflows from net inflows in the first quarter of 2019, even as the merchandise trade deficit declined.”
The BSP also reported a final gross international reserves (GIR) of $88.86 billion for the same period.
The BSP usually announce an initial GIR every mid-month. But during the enhanced community quarantine, the preliminary GIR of $88.99 billion was released last April 30.
The BSP is currently reviewing all its external account projections, particularly its foreign direct investment forecast.
BSP Governor Benjamin E. Diokno has said that the COVID-19 pandemic and its
negative impact on global outlook and investor confidence, is making any projections “tentative” because of the “high level of uncertainty”.
But, he said that “BSP will release its external account forecast based on firmer market indications once approved by the Monetary Board.”
The BOP includes FDIs, remittances, and foreign portfolio inflows, among other data.
For 2020, the BSP has a BOP projection of $3 billion surplus. Last year, the BOP was also a surplus of $7.843 billion.