PH posts USD 226M BOP surplus, reserves hit USD 106B

The Philippines swung to a balance of payments (BOP) surplus of USD 226 million in June 2025, reversing a USD 155 million deficit recorded in the same month last year, according to data released by the Bangko Sentral ng Pilipinas (BSP).

The BOP is a comprehensive summary of the country’s economic transactions with the rest of the world, including trade, investment, and financial transfers.

The surplus in June was attributed to foreign currency deposits made by the national government (NG) with the BSP, as well as income earned from the central bank’s external investments.

This development helped ease the country’s cumulative BOP deficit for the first half of 2025 to USD 5.6 billion, slightly down from the USD 5.8 billion recorded in the first five months of the year.

The improvement in the BOP position also coincided with a rise in the country’s gross international reserves (GIR), which increased from USD 105.2 billion in May to USD 106.0 billion in June.

The current GIR level is equivalent to 7.2 months’ worth of imports of goods and payments for services and primary income.

It also covers approximately 3.4 times the country’s short-term external debt based on residual maturity, according to the BSP.

This is important to ordinary Filipinos because a healthier BOP and higher reserves help stabilize the Philippine peso, keeping inflation in check and reducing pressure on the cost of imported goods like fuel, food, and electronics.

With a strong GIR buffer, the country can better weather global financial shocks, protect jobs tied to trade and investment, and maintain the affordability of basic commodities.

“Strong external buffers improve investor confidence and provide the government more flexibility to respond to economic challenges without sacrificing social services,” said an economist familiar with BSP policy.

Despite the June surplus, the BOP remains in deficit for the year to date, primarily due to the country’s trade imbalance.

Preliminary data from the Philippine Statistics Authority (PSA) showed that the trade deficit for January to May 2025 stood at USD 19.7 billion—an improvement from the USD 20.7 billion gap during the same period in 2024.

The BOP deficit was partly offset by steady inflows from overseas Filipino remittances, increased foreign borrowings by the national government, and positive foreign portfolio investment activity.

Remittances alone support household consumption and daily needs for millions of Filipino families, while foreign investments provide funding for infrastructure and job-generating industries.

A sustained surplus in future months could further strengthen the peso, improve credit ratings outlooks, and support government financing and spending priorities.

The BSP said it will continue to monitor external sector developments and maintain policies that promote economic resilience and financial inclusion.