BSP: $98M net ‘hot money’ entered Philippines in January


Foreign portfolio investments or “hot money” in the Philippines registered a net inflow of $98 million in January, the Bangko Sentral ng Pilipinas (BSP) reported Friday.

Data released by the BSP showed the $98-million in net “hot money” inflow last month is a reversal from the net outflow of $524 million posted in December 2020.

Foreign portfolio investments are also called hot money because of the ease by which the funds enter and leave markets.

The net inflow in January resulted from gross inflows of $952 million, which surpassed outflows of $854 million.

In particular, the $952-million foreign portfolio investments inflows for January reflected a 12.2% decline compared to the $1.1 billion recorded in December 2020.

The BSP said about 62.1% of investments registered were in PSE-listed securities, mainly to banks, holding firms, property companies, food, beverage and tobacco companies, and transportation services firms.

The remaining 37.9% went to investments in peso government securities.


The United Kingdom, Singapore, United States, Luxembourg, and Hong Kong were the top five investor countries for the month, with combined share to total at 83.4%, according to the central bank.

Outflows for the month, meanwhile, amounting $854 million were lower compared to the level recorded in December 2020 at $1.6 billion.

The US received 71.7% of total outflows, according to the BSP.

The central bank attributed the inflow and outflow of hot money in January on the following developments:

  •     the storming of the US Capitol resulting in several deaths and injuries
  •     confirmation of Joe Biden as the 46th US President
  •     reports confirming the local transmission of the new COVID-19 variant
  •     emergency use authorization granted by the Food and Drug Administration for two COVID-19 vaccines along with other vaccine rollout policies
  •     investor reaction to the country’s investment grade rating from Fitch Ratings, which was retained at “BBB” with a stable  outlook.

“Furthermore, the $98-million net inflows is a reversal of the $486 million net outflows recorded for the same period a year ago,” the BSP said.—AOL, GMA News