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PH posts US$301.33-M net hot money inflow in January '17

The Bangko Sentral ng Pilipinas headquarters on Roxas Boulevard, Manila. BUSINESSWORLD ONLINE PHOTO means BUSINESS

MANILA - Investors’ sentiment on placing their funds in the Philippines despite the impact of a negative external environment reversed to positive in January 2017 compared to the same period last year.

Data released by the Bangko Sentral ng Pilipinas (BSP) Thursday showed that foreign portfolio investments, otherwise known as hot money due to the speed it comes in and out of an economy, registered US$301.33 million net inflows, a turnaround from the $129.85 million net outflows same period last year.

Total inflows in the first month this year reached $1.15 billion, higher than the $820.4 million same period in 2016 and the previous month’s $1 billion.

”This may be attributed to optimism about the New Year and positive investor reaction to the announced 6.6 percent GDP (gross domestic product) growth of the country in the fourth quarter of 2016,” the BSP said.

Bulk, or 95.4 percent, of the inflows were placed in shares listed with the Philippine Stock Exchange (PSE) - in banks; holding firms; property companies; food, beverage and tobacco firms; and utilities firms.

Some 3.4 percent were placed in peso-denominated government securities (GS) while the balance of 1.2 percent were invested in other peso debt instruments (OPDIs).

About 79.6 percent of the investments came from the United Kingdom, United States, Singapore, Luxembourg and Hong Kong.

Outflows in the same period this 2017 amounted to $845.83 million, lower than the $950.25 million a year ago. Bulk of these were repatriated to the US.