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$1.2-B net portfolio inflows recorded in 2018

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By Lee Chipongian

The country’s foreign portfolio investments registered net inflows of $1.2 billion in 2018 compared to net ouflows of 2017 amounting to $195 million.

A logo of the Bangko Sentral ng Pilipinas is seen at their headquarters in Manila, (REUTERS/Romeo Ranoco / MANILA BULLETIN)

A logo of the Bangko Sentral ng Pilipinas is seen at their headquarters in Manila, (REUTERS/Romeo Ranoco / MANILA BULLETIN)

The Bangko Sentral ng Pilipinas (BSP) had projected a net ouflow of $100 million for 2018 and net outflow of $200 million for this year.

In a statement Thursday, the BSP said the total registered foreign portfolio investments or “hot money” for 2018 reached $16.03 billion, down by 0.2 percent year-on-year or from $16.07 billion.

“On a monthly basis, the highest gross inflows were recorded in March ($2.5 billion) while the lowest was noted in September ($743 million),” the BSP noted.

The first quarter of 2018 registered the biggest inflows during the year of $5.1 billion which is about 32 percent of the total for the entire year.

The central bank said “investors’ optimism over the passage of the first phase of the government’s tax reform program” contributed to foreign fund inflows. The first TRAIN package was implemented on January 1, 2018.

Last year, the BSP recorded some $14.8 billion outflows. This was lower by 8.8 percent compared to $16.3 billion in 2017. “About 96.8 percent of total outflows represented capital repatriation with the remaining 3.2 percent pertaining to earnings,” said the BSP.

The central bank stated that 71.4 percent of portfolio investments were placed in listed securities at the stock market while 20.1 percent were invested in peso government securities. Another 8.3 percent were in peso debt instruments (OPDIs).

The BSP noted net inflows in OPDIs of $1.3 billion and peso government securities of $1.2 billion. There were net outflows recorded for listed securities of about $1.3 billion.

Around 72.8 percent of registered inflows came from investors in the US, the United Kingdom, Singapore, Netherlands, and Hong Kong. Investors based in US “continued to be the main destination of outflows, receiving 78.8 percent of total,” according to the BSP.

Hot money flows are considered highly speculative funds.

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