Investments – also called hot money for the ease they enter and exit economies – posted a net inflow of $1.067 billion in July, a reversal of last year’s $160.1 million net outflows. Philstar.com/File photo
MANILA, Philippines – Foreign portfolio investments rose to their highest level in 17 months in July, the Bangko Sentral ng Pilipinas (BSP) reported yesterday.
Investments – also called hot money for the ease they enter and exit economies – posted a net inflow of $1.067 billion in July, a reversal of last year’s $160.1 million net outflows.
It also marked the highest level since the $1.19 billion net inflow recorded in February last year.
A net inflow indicates more investments entered than left. Net outflow signifies otherwise.
“This was mainly due to an initial public offering of an industrial company as well as renewed interest in peso government securities,” the central bank said in a statement.
Broken down, total inflows rose more than a quarter to $2.269 billion, while outflows declined 11.4 percent to $1.203 billion.
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Last month, cement firm Cemex Philippines debuted at the Philippine Stock Exchange by raising P25.13 billion, the biggest initial public offering since 2013.
This coincided with the first month in power of President Duterte, during which the PSE index breached the 8,000-mark.
According to the central bank, 81.7 percent of hot money flows that month went to PSE-listed securities, particularly to property and holding firms, construction, banks and food, beverage and tobacco companies.
The balance of 18.3 percent went to peso-denominated securities.
Net inflows for July brought the year-to-date tally to $1.647 billion, more than double last year’s $478.29 million.
The bulk of inflows, accounting for nearly 80 percent, came from the US, UK, Hong Kong, Singapore and Luxembourg. The US remained the top destination for outflows.
The total tally so far was way above the BSP’s forecast of just $200 million net inflow for the year.
