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Foreign Portfolio Investments Result in Net Outflows in November 2015


Transactions for the month resulted in overall net outflows of US$69 million, in contrast to the net inflows recorded last month (US$28 million) and a year ago (US$370 million).

 Registered foreign portfolio investments for November 2015 declined to US$1.1 billion from US$1.6 billion in October (or by 34.1 percent) as investors reacted to: i) weak third-quarter corporate earnings reports; ii) renewed concerns on the prospect of interest rate hike in the US by December 2015; and iii) the thin volume of transactions brought about by trading holidays. The level is also lower by
39.4 percent compared to the US$1.8 billion recorded a year ago. 

 Total outflows for the month amounted to US$1.2 billion which is lower compared to  US$1.6 billion in October 2015 and US$1.4 billion for the same period last year (by 28.7 and 18.7 percent, respectively).

About 78.1 percent of investments registered in November were in PSE-listed securities (mainly pertaining to holding firms; banks; property companies; food, beverage and tobacco firms; and utilities companies) and 21.5 percent in Peso GS; the rest of the investments were in other peso debt instruments (OPDIs) (0.4 percent). Transactions in Peso GS and OPDIs yielded net inflows of  US$16 million and US$4 million, respectively while those for PSE-listed securities resulted in net outflows of US$89 million.

The United Kingdom, the United States, Singapore, Luxembourg, and Belgium were the top five (5) investor countries for the month, with combined share to total of 82.8 percent. The United States continued to be the main destination of outflows, receiving 80.6 percent of total.

Registration of inward foreign investments with the Bangko Sentral ng Pilipinas (BSP) is voluntary under the liberalized rules on foreign exchange transactions.  The issuance of a BSP registration document entitles the investor or his representative to buy foreign exchange from authorized agent banks and/or their subsidiary/affiliate foreign exchange corporations for repatriation of capital and remittance of earnings that accrue on the registered investment.  Without such registration, the foreign investor can still repatriate capital and remit earnings on his investment but the foreign exchange will have to be sourced outside the banking system.

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