THE Philippines’ balance of payments (BOP) swung into surplus in May, Bangko Sentral ng Pilipinas (BSP) data released late on Friday showed.
At $131 million, the surplus rebounded from April’s $2.1-billion and last year’s $298-million shortfall.
The result brought the year-to-date BOP to a $7.3-billion deficit, more than the $5.82 billion recorded in January-May 2025.
“The year-to-date BOP position reflected the continued trade in goods deficit, and net outflows from foreign portfolio investments,” the central bank said in a statement.
“However, this was partly offset by the sustained net inflows from personal remittances of overseas Filipinos (OFs), foreign borrowings by the NG, trade in services, and foreign direct investments,” it added.
The BOP is a summary of a country’s transactions with the rest of the world for a specific period. It consists of the current account, which covers trade in goods, services and primary and secondary income (which includes overseas Filipino worker remittances); the capital account — capital transfers and nonfinancial assets; and the financial account or investments from abroad.
The country’s BOP position ended in a $5.7-billion deficit last year, a reversal from 2024’s $609-million surplus. The central bank expects the deficit to widen this year to $7.8 billion, up from the $5.9-billion outlook three months earlier. The forecast for next year has been set at $8.5 billion.
The country’s gross international reserves (GIR), meanwhile, further dropped to $103.9 billion as of end-May from $104.3 billion a month earlier. This is the lowest recorded since January 2025’s $103.3 billion.
The central bank, however, said the level remained adequate and provided “sufficient foreign currency to meet the country’s import needs, service its external debt obligations, and serve as a buffer against external economic shocks.”
It is also equivalent to about 3.9 times the country’s short-term external debt based on residual maturity and could cover up to 6.7 months’ worth of import of goods and payment of services.
The BSP said the slight movement in the reserves was mainly due to the national government’s use of its foreign currency deposits with the central bank to service external debt, lower valuations of the BSP’s gold holdings and foreign currency reserve assets and the BSP’s net foreign exchange operations.
“These were partly offset, however, by NG’s net foreign currency deposits with the BSP, and BSP’s net income from its investments abroad,” it added.
The country ended 2025 with $110.8 billion in reserves, higher than the projected $109 billion. The country’s foreign reserves are expected to end 2026 at a higher $111 billion instead of $110 billion and rise to $112 billion next year.
GIR consists of the BSP’s foreign investments, gold, foreign exchange, reserve position in the International Monetary Fund and special drawing rights.
It helps “a country finance its imports and foreign debt obligations, stabilize its currency, and provide a buffer against external economic shocks,” the central bank said.
It is considered adequate if it can finance at least three months’ worth of the country’s imports of goods and payments of services and primary income.
It is also considered sufficient if it is enough to pay off all of the country’s foreign liabilities that will fall due in the next 12 months.
NIÑA MYKA PAULINE ARCEO
