The balance of payments (BOP), or what is left after the country’s foreign-currency expenses are deducted from its foreign-exchange earnings, stood as a deficit over 10 months this year, the Bangko Sentral ng Pilipinas (BSP) said on Monday.
The imbalance as of end-October showed a net outflow aggregating $1.735 billion.
In October alone, the BOP imbalance stood at $368 million, the largest over three months, as consequence of so-called forex operations of the BSP and pay downs on maturing obligations of the national government.
The BOP is the summary of the country’s transactions with the rest of the world. A deficit means more dollars exiting the country than coming in.
The $368-million deficit in October was the thinnest since July and a reversal from the previous month’s surplus of $24 million but larger than the previous year’s $183-million deficit.
The 10-month BOP shortfall of $1.735 billion was a significant decline from the $1.465-billion surplus reported in the same January-to-October period last year.
The Central Bank traced the outflows to the forex operations of the BSP and payments made by the national government for its maturing forex obligations during the month in review.
The deficit could have been larger, the BSP said, if not partially offset by net foreign currency deposits of the national government and income from BSP’s investments abroad.
The Central Bank has since vowed to maintain “strategic presence” in the country’s forex market to smoothen so-called excess volatilities arising from market movements.
In October the local currency notably weakened, averaging P51.343 per dollar during the month, data from the BSP showed. This was weaker than the P51.009 per dollar average the previous month and P51.238 per dollar in the first 20 days of November.
The peso has reverted to P50 per dollar in recent days, with latest data showing P50.79 per dollar on Monday. This was stronger than trades averaging P50.95 per dollar the previous trading day.