On the external front, the country’s current account has been in surplus for 14 consecutive years,4 due to the sustained increase in overseas Filipinos (OFs) remittances, as well as business process outsourcing (BPO) revenues and tourism receipts. We saw a narrowing of the current account surplus in recent months. This trend may continue, as imports of capital goods are seen to further pick up.
Such importation, we note, is necessary to support the expansion of the economy in the medium term. Steady foreign exchange (FX) inflows from OF remittances and BPOs, however, will continue to allow us to maintain adequate FX reserves. We expect our gross international reserves to continue to be more than sufficient to meet the country’s FX liquidity requirements.