The country’s overall balance of payments (BOP) position posted a deficit of $2.7 billion in September 2018, a reversal of the $24 million surplus recorded in the same month last year, according to the Bangko Sentral ng Pilipinas (BSP).
Outflows in September 2018 stemmed mainly from foreign exchange operations of the BSP and payments made by the National Government (NG) for its foreign exchange obligations. These were partially offset, however, by the net foreign currency deposits of the NG.
On a cumulative basis, the BOP registered a deficit of $5.14 billion during the period January-September 2018. The higher deficit may be attributed partly to the widening merchandise trade deficit (based on the Philippine Statistics Authority’s preliminary data) for the first eight months of the year. This, in turn, was brought about mainly by the sustained rise in imports of raw materials and intermediate goods as well as capital goods to support domestic economic expansion.
The reported BOP position is consistent with the final GIR level of $74.94 billion as of end-September 2018. At this level, the GIR represents a more than ample liquidity buffer and is equivalent to 6.8 months’ worth of imports of goods and payments of services and primary income. It is also equivalent to 5.9 times the country’s short-term external debt based on original maturity and 4.2 times based on residual maturity.