'Hot money' inflows surge 137% in April
MANILA, Philippines - Foreign portfolio investments or "hot money" more than doubled in April from the year before, boosted in part by large subscriptions in shares of LT Group Inc.
The Bangko Sentral ng Pilipinas (BSP) reported hot money amounted to $3.5 billion in April, 137.4% higher than the $1.5 billion recorded in the same month of 2012.
The latest figure was also 50.3% more than the $2.3 billion inflows that came in last March.
Contributing to the growth were $970 million worth of subscriptions in tycoon Lucio Tan's LT Group, which sold shares to global investors in April, the BSP said.
Other factors that boosted hot money inflows were:
- positive first-quarter corporate earnings reports
- BSP's decision to cut Special Deposit Account rates by 50 basis points to 2% across all tenors
- Standard & Poor's higher growth forecasts for the Philippines (6.5% in 2013, 6.3% in 2014)
Investments in Philippine Stock Exchange (PSE) securities amounted to $3 billion or 85.9% of total portfolio investments.
The BSP said the main beneficiaries of investments in PSE-listed securities were:
- food, beverage and tobacco firms - $1.1 billion
- holding firms - $918 million
- property firms - $260 million
- banks - $216 million
The top 5 investor countries in April were US, UK, Singapore, Hong Kong and Luxembourge, which, combined, had a share of 87.8%.
"The US continued to be the main beneficiary of outflows from investments receiving $1.7 billion," noted the central bank.
Portfolio investment outflows meanwhile declined to $2.4 billion in April 2013 from $2.7 billion in March 2013. This resulted in net inflows of $1.1 billion in April, higher than the $333 million in April 2012. - with reports from Cai Ordinario/Rappler.com