BSP eyes changes in BOP projection

Bangko Sentral ng Pilipinas (Central Bank of the Philippines). Wikipedia photo

MANILA — The Bangko Sentral ng Pilipinas (BSP) is considering some changes in its 2014 balance of payments (BOP) forecast given the development both in the local and external fronts.

It has set a USD 3 billion BOP surplus for this year but as of end-April the country has registered a USD 4.5 billion deficit in its BOP position.

The largest deficit was posted last January at USD 4.48 billion followed by the USD 340 million in March and USD 19 billion in April.

On the other hand, the country registered a USD 345 million BOP surplus last February.

Tetangco cited that although the country’s BOP position is generally on the deficit, the outflows has been declining.

“We have to review the balance of payments projections to take into account the worries and developments,” he told reporters at the sidelines of the Financial Times-First Metro Investment Corp. (FT-FMIC) Philippines Investment Summit in Mandarin Oriental Hotel in Makati Monday.

Tetangco said one of the considerations in the BOP target review is the prospects on capital and financial transaction account, which in turn covers the foreign portfolio flows.

Another factor is the current account item, which covers remittances, among others.

Tetangco said there might be some changes in the current account target but it will not be significant.

“But I would say that changes will most likely going to be smaller than potential changes in the capital and financial transactions account,” he added.