The Philippines generated far more foreign currency earnings in July than it spent during the month, allowing the country to post a surplus in the balance of payments (BOP) totaling USD62 million.
The Bangko Sentral ng Pilipinas on Monday said, this was a reversal from the USD53 million deficit recorded in July last year.
According to the BSP, the BOP surplus in July resulted from inflows as net income from the BSP’s investments abroad and the National Government’s (NG) net foreign currency deposits with the central bank.
The BOP surplus in July brought the year-to-date BOP to USD1.5 billion surplus, lower than the USD2.2 billion surplus recorded in January-July 2023.
Based on preliminary data, the cumulative BOP surplus resulted from the narrowing trade in goods deficit alongside the continued net inflows from personal remittances, net foreign direct investment, trade in services, net foreign borrowings by the NG, and net foreign portfolio investments.
The surplus BOP also reflects an increase in foreign currency reserves of the gross international reserves (GIR) to USD106.7 billion as of end-July 2024 from only USD105.2 billion a month earlier.
The foreign currency reserves are more than adequate external liquidity buffer equivalent to 7.9 months’ worth of imports of goods and payments of services and primary income.
It is also 6.1 times the country’s short-term external debt based on original maturity and 3.8 times based on residual maturity.
