$345 M net hot money outflow posted in November


By Lee C. Chipongian

The central bank registered $345 million worth of net outflows in November and attributing the withdrawals on the ongoing trade wars and US President Donald Trump’s impeachment.

The Bangko Sentral ng Pilipinas (BSP) said the November net “hot money” outflows is a reversal of the $832 million net inflows same time in 2018.

For the January-November period, the country’s foreign portfolio investments is a net outflow of $1.57 billion in contrast to the $925 million net inflows same time last year.

Total registered investments year-on-year decreased by 41.4 percent.

According to the BSP, investor sentiments were affected by the “stalled negotiations between the US and China which could delay the first phase of the implementation of their trade deal (and the) start of the public impeachment hearings on Trump.”

“(The) US Congress’ passage of a human rights bill supporting the pro-democracy protests in Hong Kong and the rebalancing of the Morgan Stanley Capital International Philippines Index to reflect its new weightings” were also factors for the net hot money outflows.

In November, the BSP registered $1.5 billion outflows and $1.2 billion inflows. The $1.2 billion inflows is 4.5 percent down from $1.3 billion in October.

Outflows totaled $1.5 billion which were 34.2 percent higher compared to $1.1 billion in October. “The US received 73.4 percent of total outflows,” said the BSP.

About 86.4 percent of portfolio funds were invested in listed securities at the Philippine Stock Exchange such as in holding firms, banks, property companies, food, beverage and tobacco firms, and transportation services companies. The rest or 13.6 percent went into peso government securities.

The BSP said the top five investor countries accounting for 78.6 percent of total investments are the United Kingdom, the US, Singapore, Hong Kong, and Luxembourg.