Hot money reverses to outflows in Sept.

Published October 28, 2021, 4:39 PM

by Lee C. Chipongian

Foreign portfolio investments in September reversed to a net outflow of $24 million versus the previous month’s net inflow of $12 million, the Bangko Sentral ng Pilipinas (BSP) said on Thursday, Oct. 28.

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The $24 million net outflows are lower than the $494 million net outflows registered in the same period in 2020. The BSP-registered gross outflows, in the meantime, amounted to $1.21 billion for September only while gross inflows totaled $1.19 billion.

For the January to September 2021, the BSP reported net outflows of $459 million, lower than the $4.4 billion net outflows in the same time in 2020. The end-September gross inflows reached $10.20 billion while gross outflows amounted to $10.69 billion.

Foreign portfolio funds or hot money are invested in the following: Philippine Stock Exchange-listed securities; peso-denominated government securities; peso time deposits with minimum tenor of 90 days; other peso debt instruments; unit investment trust funds; and other portfolio investments such as Exchange Traded Funds and Philippine Depositary Receipts

In September, about 74.3 percent of investments were in listed securities such as in holding firms, property, telecommunication, food, beverage and tobacco and utilities. The remaining 25.7 percent were placed in peso government securities.

The BSP said the top five investor countries with a combined 84.4 percent share of the total hot money were the United Kingdom, the US, Switzerland, Hong Kong and Singapore.

The $1.21 billion gross outflows for September were 52.4 percent higher than $795 million in August with the US receiving 70.8 percent of total outflows.

 
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