Net hot money outflow at $23-M in June

Rappler.com
The amount was way smaller than May's $640.84 million - the highest monthly figure on record so far

HOT MONEY. Foreign portfolio investments continued to register a net outflow in June. Photo from AFP

MANILA, Philippines – Foreign portfolio investments or “hot money” continued to flow out of the Philippines in June, the Bangko Sentral ng Pilipinas (BSP) said Thursday, July 11.

Foreigners invested $2.841 billion in Philippine stocks and bonds in June, but withdrew $2.864 billion, resulting in a net outflow of $22.98 million.

The net outflow was however way smaller than May’s $640.84 million, the highest monthly figure on record so far.

Foreign investors dumped emerging markets in May as a “knee-jerk reaction” to the US Federal Reserve’s announcement it might reel in its stimulus program, the BSP said.

The Fed said it was considering the move due to signs the US economy was recovering.

The Philippine stock market lost most of its gains for 2013 following the Fed’s announcement, but rebounded later on.

The BSP said Thursday that “the expected return of funds to emerging markets has already started in June.”

Investments in June mostly went to stocks, peso-denominated government securities, and peso time deposits.

Holding firms, banks, property, food and beverage and telecommunications companies were the main recipients of funds going into the stock market.

Most of the investments came from the United Kingdom, US, Luxembourg, Singapore and Hong Kong.

Total foreign portfolio investments in the first half amounted to a net inflow of $1.554 billion. – Rappler.com

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