‘Hot money’ flows turn negative in February

US-Dollar

Manila, Philippines – Foreign portfolio investments turned negative in February, recording the biggest net outflow in four months based on Bangko Sentral ng Pilipinas (BSP) data released on Thursday.

The $545.14-million net “hot money” outflow — a reversal from January’s net inflow of $162.16 million — was attributed by the BSP to profit-taking and investor concerns over US Federal Reserve rate hikes.

The February result was the largest net outflow since last October’s $563.42 million. It was also higher than the year-earlier net outflow of $409.01 million.

Registered foreign portfolio investments amounted to $1.028 billion for the month, 36.6 percent lower than the $1.623 billion recorded in January 2018. Inflows, on the other hand, rose by 4.8 percent from $981.2 million.

The bulk or 81 percent was invested in Philippine Stock Exchange-listed securities — mainly holding firms; property developers; banks; food, beverage and tobacco firms; and casinos and gaming companies.
Peso government securities accounted for the rest.

The United Kingdom, United States, Malaysia, Hong Kong, Luxembourg, and Singapore were the top six investor countries with a combined 85.1 percent of the total.

February’s outflows of $1.573 billion reflected increases of 7.7 percent and 13.2 percent, respectively, compared to the previous month ($1.461 billion) and a year ago ($1.390 billion).

The United States remained the main destination of repatriated funds, accounting for 73.8 percent.

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