The central bank has lowered its forecast for the amount of dollar net inflows that it expects the Philippines to experience this year and next as the recovering economy starts to feed the demand for more imports combined with rising receipts from exports.
In a statement, the Bangko Sentral ng Pilipinas said the policy making Monetary Board approved the downward revision of the balance of payments forecast for 2021 to $4.1 billion, representing 1.1 percent of gross domestic product (GDP), from the $7.1 billion or 1.8 percent of GDP projected last June.
The narrower balance of payments surplus reflects the expected lower current account surplus of $3.5 billion from the previous projection of $10 billion amid the expected widening of the trade-in-goods deficit.
This, in turn, results from the projected robust expansion of goods exports by 14 percent from the previous forecast of 10 percent combined with an even stronger acceleration of goods imports by 20 percent from 12 percent.
Both of these metrics reflected the stronger-than-expected growth in the first half of 2021, the central bank said.
Meanwhile, services exports and imports are seen to contract by 2 percent and 4 percent in 2021, respectively.
Overseas Filipino cash remittances are seen to pick up at a faster pace of 6 percent in 2021 from 4 percent. Lending support to this upward revision are the sustained inflows of dollar remittances.
The financial account, meanwhile, is projected to post lower net outflows.
For 2022, the overall balance of payments surplus is seen to further moderate to $1.7 billion or 0.4 percent of GDP, reflecting the anticipated reversal of the current account into a deficit of $1.4 billion or -0.3 percent of GDP. INQ
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