PORTFOLIO flows more than doubled on gross basis in the first six months to $9.14 billion, driven higher by the country’s strengthening fundamentals even as countries in the euro zone and the United States face credit downgrades.
The Bangko Sentral ng Pilipinas (BSP) said gross inflows a year earlier totaled only $4.33 billion and indicative of an economy as net recipient of foreign capital along with most others in the region.
Some $2.36 billion flowed inward on net basis during the period, which was three times larger than a year earlier when this totaled only $686.57 million.
The BSP traced this development to fund managers preferring to invest their money in government securities totaling $4.2 billion in this case and representing 45.5 percent of total registered investments.
This compared with year-ago investments in government securities of only $995 million.
According to the BSP, the preference for government securities was driven by attractive interest rates, particularly for long-dated government securities.
Foreign funds brought to the Philippine Stock Exchange (PSE) totaled $4.7 billion during the period and surpassed the year-ago level of only $3 billion.
The funds brought to the local stock market benefited mostly holding companies as fund managers brought $1.2 billion worth of shares.
The next biggest beneficiaries were bank stocks where fund managers bought $798 million worth of shares followed by telecommunications stocks, where another $629 million worth of shares were purchased.
Property firms attracted $603 million of portfolio investments during the period, while the various utilities, such as Meralco and PLDT, attracted another $594 million.
The BSP said the combined investments in PSE-listed shares and in peso government securities aggregated 96.7 percent of hot-money investments registered with the BSP.
The balance of the investments were in peso time deposits worth $292 million, in so-called unit investment trust funds or UITFs worth another $6 million, and money-market instruments worth also $6 million.
Hot-money outflows for the period totaled only $6.8 billion, mostly in the form of interim peso deposits, the BSP said.
