• Hot money net outflow $15M in first week of June


    Foreign portfolio investments, or hot money, registered a net outflow of $15.1 million for the week ending June 6.

    Total foreign portfolio investment inflows during the period reached $571.56 million while outflows totaled $586.66 million, data from the Bangko Sentral ng Pilipinas (BSP) shows.

    In May this year, foreign portfolio investments recorded a net inflow of $545.08 million, reversing the $640.84 million net outflow posted a year earlier.

    By next year, the central bank expects foreign portfolio investment inflows to decline to $2.1 billion from last year’s $4.22 billion.

    Also known as speculative funds, foreign portfolio investments represent money invested in financial assets such as shares of companies listed on the Philippine Stock Exchange (PSE), peso-denominated government debt instruments and peso time deposits.

    Foreign portfolio investments are one of the components of the country’s balance of payments (BOP), which summarizes the country’s economic transactions with the rest of the world over a certain period. Components of the BOP include trade, foreign direct and portfolio investments, and even remittances from Filipinos abroad.

    The country’s payments position reversed to a surplus of $373 million in May from a deficit of $19 million in April.

    Earlier, the BSP announced that it is conducting a review and update of the BOP projections given the actual developments in both the domestic and external economic environment during the first five months of the year.


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