The balance of payments or BOP showed a deficit of $148 million in April 2023 primarily due to the government’s payments of its foreign currency debt obligations, data from Bangko Sentral ng Pilipinas or BSP said over the weekend.

According to BSP, the April 2023 BOP is lower than the $415 million deficit recorded in the same month the previous year.

But the deficit in April, BSP said the cumulative BOP position for the first four months of the year registered a surplus of $3.3 billion.

This surplus is significantly higher than the $79 million recorded during the same period last year.

“The surplus was mainly driven by personal remittances, net foreign borrowings by the national government, and foreign direct investments,” BSP said.

Meanwhile, the gross international reserves increased to $101.8 billion as of April 2023 from $101.5 billion at the end of March 2023.

This level of reserves represents a more than sufficient external liquidity buffer, equivalent to 7.6 months’ worth of imports of goods and payments of services and primary income.

Additionally, it is about six times the country’s short-term external debt based on original maturity and 4.1 times based on residual maturity.

Forex inflows growing

In an emailed commentary, Rizal Commercial Banking Corp. chief economist Michael Ricafort forecasts further improvement in the coming months as structural US dollar inflows continue to increase.

“BOP (registered a surplus) partly due to proceeds of the national government’s foreign currency-denominated borrowings/debt,” Ricafort said.

“For the coming months, BOP data could still be supported by the continued growth in the country’s structural US dollar inflows such as (overseas Filipino workers’) remittances, (business process outsourcing) revenues, foreign investments, exports, foreign tourism receipts, among others,” he added.