We are sorry, the requested page does not exist
M3, bank lending growths reflect
Bank lending of universal and commercial banks or U/KBs and domestic liquidity posted higher expansion in May, data from Bangko Sentral ng Pilipinas revealed over the weekend. Data recently released by BSP showed that U/KBs’ outstanding loans, net of reverse repurchase or RRP placements with the BSP, posted higher annual expansion in May at 9.4 percent from 9.7 percent in April. On a month-on-month seasonally -adjusted basis, outstanding universal and commercial bank loans, net of RRPs, increased by 0.7 percent. Outstanding loans to residents, net of RRPs, went up 9.3 percent in May from 9.6 percent in April. Similarly, outstanding loans for production activities rose 7.9 percent in May after growing 8.3 percent in the previous month. The central bank attributed the growth to the continued increase in loans to significant industries, specifically electricity, gas, steam, and airconditioning supply (14.1 percent); real estate activities (5.5 percent); wholesale and retail trade, and repair of motor vehicles and motorcycles (8.6 percent); information and communication (15.9 percent); and financial and insurance activities (7.3 percent). Consumer loans to residents grew slightly faster rate of 22.7 percent in May from 22.3 percent in April due to the increase in credit card, motor vehicle and salary loans. Outstanding loans to non-residents also went up by 13.2 percent in May from 12.2 percent in the previous month. “The moderation in bank lending activity reflects the impact of the BSP’s cumulative policy rate adjustments,” BSP said. “Looking ahead, the BSP will continue to ensure that domestic liquidity and credit dynamics align with its price and financial stability mandates,” it added. P16.3 trillion circulating Meanwhile, BSP said M3 grew 6.6 percent year-on-year to about P16.3 trillion in May 2023. On a month-on-month seasonally-adjusted basis, M3 increased by about 0.3 percent. Domestic claims rose 11.4 percent year-on-year in May from 11.9 percent in the previous month. Claims on the private sector grew by 9.3 percent in May from 9.8 percent (revised) in April, driven by the sustained expansion in bank lending to non-financial private corporations and households. Net claims on the central government also expanded by 18.3 percent in May from 20.2 percent (revised) in April, owing mainly to the borrowings by the National Government. Net foreign assets in peso terms grew by 2.7 percent year-on-year in May following the 0.2-percent contraction in April. The BSP’s NFA position expanded by 4.2 percent in May after increasing by 2.5 percent in the previous month. Meanwhile, the NFA of banks declined on account of higher bills payable. “Looking ahead, the BSP will continue to ensure that domestic liquidity conditions remain consistent with the BSP’s price and financial stability objectives,” BSP said. The post M3, bank lending growths reflect appeared first on Daily Tribune......»»
The importance of cyber security
Cyberattacks are on the rise! In the past, we associated this terrifying incident with online banks and payment platforms. However, even government websites, not known as financial institutions, from which money may be stolen, or unauthorized payments are also targets. Last Sunday, 15 October, the website of the House of Representatives was vandalized before noon by a group calling itself “3MUSKETEERZ.” A face with a mocking meme with the phrases “You’ve been hacked” and “Have a nice day” appeared on the website. Below the face was the message, “Happy April Fullz Kahit October palang (even if it’s still)! Fix your website.” A few minutes later, the website went down and became inaccessible. Shortly after, the House of Representatives issued a statement assuring the public that the House had already taken action and coordinated with the government agencies concerned to deal with the matter. “While we work to restore the website fully, we ask for patience and understanding. We are committed to ensure the security and integrity of our digital platforms, and we will implement additional measures to prevent such incidents in the future,” the statement said. Relatedly, also recall that on 22 September, a system of the Philippine Health Insurance Corporation was similarly attacked, preventing access for a week. Reports stated the data breach affected employees’ workstations, application servers, and users’ data, including names, addresses, dates of birth, gender, phone numbers and PhilHealth identification numbers. On 31 August, the Department of Science and Technology’s OneExpert portal was also subjected to a cyberattack. In a statement on 13 October, the DoST assured the general public that the virtual assault compromised no personal data. In all the above instances, whether personal data or sensitive information were stolen, it causes alarm to us Filipinos. The call to government agencies and ordinary Filipinos to be vigilant and careful with our online information and accounts has become louder than ever. The same holds true for institutions and businesses, which, by the nature of their activities, are entrusted with and tasked to safeguard large amounts of personal information and are responsible for keeping this trust by whatever means appropriate. I now want to stress the importance of cyber security not just for individuals and juridical entities but for the entire nation holistically. Protection against cyber threats: In today’s digital age, cyber threats like hacking, data breaches, and identity theft are becoming more prevalent. Implementing robust cyber security measures helps protect us from these threats. Safeguarding sensitive information: Cyber security also helps protect sensitive information such as personal data, financial details and intellectual property. This is crucial for maintaining privacy and preventing unauthorized access or misuse of information. Maintaining trust, reputation, and credibility: Cyber security is essential for building trust with customers, clients, and partners. Organizations can maintain a positive reputation and avoid potential legal and financial consequences by committing to protecting their data and privacy. Compliance with regulations: Many industries have specific regulations and standards regarding data protection and privacy. Compliance with these regulations is not only important for avoiding penalties but also for ensuring ethical practices and responsible handling of data. Business continuity: Cyber attacks can disrupt operations, leading to financial losses, reputational damage, and even business closure. Implementing effective cyber security measures helps minimize these risks and ensures business continuity. Finally, I want to end by being deliberately redundant in stating that cyber security is crucial for protecting individuals, organizations, and society from the growing threat landscape in the digital world. Cyber attackers are on the prowl; we must be alert to the possibility of attack, ready even now to implement measures to effectively counter-act or prevent the same. The post The importance of cyber security appeared first on Daily Tribune......»»
Trump told Australian businessman US nuclear subs secrets — report
Former president Donald Trump shared classified information about US nuclear submarines with an Australian businessman shortly after he left office, in a meeting at his Florida private members club Mar-a-Lago, US media said Thursday. The New York Times, citing unnamed sources, identified the businessman as billionaire Anthony Pratt, who heads one of the world's largest packaging companies. ABC News, which first revealed the story, said Pratt later shared sensitive details about the US submarines with "scores of others, including more than a dozen foreign officials, several of his own employees, and a handful of journalists." Sources told the Times that Trump's disclosures "potentially endangered the US nuclear fleet." Federal prosecutors already investigating Trump for holding classified material at Mar-a-Lago after he left office, interviewed Pratt twice about the incident, the reports said. Pratt may now be called by prosecutors to testify against Trump in his classified documents trial, which is due to start next May in Florida. Pratt met Trump at his Palm Beach club in April 2021, and told the ex-president he thought Australia should start buying its submarines from the US, ABC reported. In response, Trump allegedly told the businessman the exact number of nuclear warheads US submarines routinely carry, and precisely how close they can get to Russian submarines without being detected, the news outlet said. Aside from the classified documents case, Trump faces three other indictments: one federal and one in Georgia over his efforts to overturn his election loss and stay in power, and one in New York stemming from election-eve hush money payments in 2016 to a porn star. Trump is currently on trial in New York on charges of wildly and fraudulently inflating the value of his assets so as to get better terms from banks and insurance companies. The post Trump told Australian businessman US nuclear subs secrets — report appeared first on Daily Tribune......»»
Regional economies slowing down — WB
The World Bank expects East Asia and Pacific economies, excluding China, to grow by 4.6 percent this year as the Philippines catches up with digitalization. The WB prediction is slower than the previous 4.9 percent estimate announced by the multinational financial institution in April. If China is included, economic growth in the region is projected to settle at five percent, the World Bank’s report from Washington said last Sunday. “This is higher than average growth projected for all other emerging market and developing economies but lower than previously projected,” the World Bank said. “The East Asia and Pacific region remains one of the fastest growing and most dynamic regions in the world, even if growth is moderating,” World Bank East Asia and Pacific vice president Manuela Ferro said. The multinational financial institution said the region might continue to face challenges in supplies of goods as more typhoons hit the region in the fourth quarter this year and climate change persists. Geopolitical tensions The World Bank added geopolitical tensions aside from the Russia-Ukraine war threatens to further hamper trade. China, the world’s second largest economy, and the US have been exchanging export bans, especially on electronic and technology products. Meanwhile, the Philippines and other Southeast Asian states are protesting against China’s aggression in the West Philippine Sea. For these reasons, the World Bank said prices of goods and services might rise, forcing central banks in the region’s developing countries to raise interest rates to prevent inflation from accelerating further. However, this means consumers might cut back spending on certain goods and services, while businesses slow operations. Borrowing costs to remain high “Therefore, borrowing costs will likely remain high, constraining room for spending and raising the risk of debt distress in some countries. Furthermore, high indebtedness, combined with rising costs of servicing debt, will weigh on private investments,” the World Bank said. For its 2024 forecast, the bank is more optimistic that the region’s economy excluding China’s will expand from 4.6 percent to 4.7 percent. “Growth in the rest of the region is expected to edge up, as recovery in global growth and easing of financial conditions offsets the impact of slowing growth in China and trade policy measures in other countries,” the World Bank said. Philippine economic growth is seen to improve to 5.9 percent next year from a 5.6 percent forecast for this year. Meanwhile, China’s economy could shrink by 4.4 percent next year from a 4.8 percent estimate for 2023 due to persisting elevated debt, tamer demand for real estate, and aging population. Sustaining high growth to require reforms “Over the medium term, sustaining high growth will require reforms to maintain industrial competitiveness, diversify trading partners, and unleash the productivity-enhancing and job-creating potential of the services sector,” Ferro said. The World Bank reported digitalization and other reforms in government services in the Philippines increased productivity of firms by 1.5 percent from 2010 to 2019. Digital technologies, for example, can spread education and health services in the provinces to ensure a bigger pool of high-skilled and energetic workers. The post Regional economies slowing down — WB appeared first on Daily Tribune......»»
Phl phishing attacks highest in SE Asia, linked to 2% loss in GDP
At least two percent of the global Gross Domestic Product was lost due to increasing cases of online fraud, phishing, and scams, Senator Mark Villar said Monday. Villar, presiding over the hearing by the Senate Committee on Banks, Financial and Institutions and Currencies, lamented that the proliferation of online scams threatened not only the potential of online banking but also the stability of the banking system and the hard-earned money of the Filipino people. “While digitalization and the widespread use of digital finance opened opportunities for the banking sector, it is also apparent that opportunists also devise new methods to take advantage of this emerging financial market,” Villar said. While there’s an increasing number of Filipinos using online payment platforms, Villar noted that crimes related to digital financial transactions are also growing. “A significant number of Filipinos have been targeted by digital fraud attempts and a portion of them eventually fall victim to it,” he said. The Bangko Sentral ng Pilipinas said it has received more complaints regarding online banking transactions compared to those related to using Automated Teller Machines and credit cards, among others. In fact, the Anti-Money Laundering Council reported a rise in suspicious transactions in 2020 comprising acts of phishing, skimming, and transactions related to money mules. The Security Exchange Commission likewise noted a significant rise in complaints related to online fraud committed by online lending platforms. Villar said as these scammers take advantage of their victims, they also rattle their victims' trust in the country’s banking and financial institutions. “Trust, being the currency of the banking system, must be well-earned. Given the proliferation of online fraudsters, it is imperative that we strengthen our efforts to keep scammers at bay,” he added. Among the existing laws aimed at fighting online bank fraud include Republic Act 11765 or Financial Products and Services Consumer Protection Act; the RA 11934 or Subscriber Identity Module (SIM) Registration Act; and RA 10175 or Cybercrime Prevention Act of 2012. Villa said as criminal elements adapt to legislation to perpetuate fraud, hence, “there is a need to legislate new laws to keep them off track” such as the proposed Anti-Financial Account Scamming Act. “This measure will reinforce and earn back the public’s trust in our financial institutions,” he said. The number of phishing attacks in the Philippines during the first half of 2022 already surpassed the number of attacks at over 1.8 million detected compared to 1.34 million attacks during the entire year of 2021. Villar described the spiking cases of online scams as “extremely concerning.” This, as data from Kaspersky Security Network revealed that cases of financial phishing attempts in the Philippines from February to April 2022 were highest in Southeast Asia. Villar emphasized that the Anti-Financial Account Scamming Act or AFASA will evidently deal with cases of online fraud and will provide a regulatory framework that penalizes scammers as well as entails safeguard measures to protect Filipinos and their financial accounts. “Because of the lack of a regulatory framework that penalizes these scammers, there are and there will be more victims in the foreseeable future,” he added. AMLC executive director, Matthew David, said they required banks and payment operators to maintain the 'Know Your Customer document' for their system and store a system that could verify the identity of the clients, including the bank account owners. “They are required to do some verification in order to make sure the true identity of the customers,” David added. The public committee hearing was followed by an Executive Session due to the confidentiality and sensitivity of the issues and information that will be discussed. Villar said the executive session was conducted to ensure that law enforcement measures being undertaken to apprehend and prosecute scammers will not be disrupted. The post Phl phishing attacks highest in SE Asia, linked to 2% loss in GDP appeared first on Daily Tribune......»»
Argentina monthly inflation highest in three decades
Argentina recorded an inflation rate of 12.4 percent in August, the highest monthly change in over three decades in a country dogged by chronic economic instability, its statistics agency said Wednesday. Prices also rose 124 percent over the past 12 months, according to a report by the Indec agency published a little over a month before general elections. "There is nothing, no money to save. We live day to day," said teacher Karina Sablich, while doing her grocery shopping. Economy Minister Sergio Massa, who is running for president, said Wednesday that "August has been one of the worst months... of the past 30 years" for Argentina's economy, blaming an "imposition by the International Monetary Fund." The increase in inflation had been expected after the peso was devalued by 21 percent in August, which had been agreed with the IMF in order to unblock part of a $44 billion loan package. The last time monthly inflation hit double digits was in April 2002, when it stood at 10.4 percent. Prior to that, the highest monthly rate was recorded at 27 percent in February 1991. The prices of food and non-alcoholic beverages saw the highest jump in August, at 15.6 percent. "An anti-inflationary plan is needed, but obviously that won't happen until" a new government takes over in December, said economist Victor Beker, from the University of Belgrano. 'The saddest thing' Argentines are no stranger to inflation woes, with several periods of hyperinflation in the late eighties and early nineties, which reached up to 3,000 percent. To exit that crisis, the government pegged the currency to the US dollar, but a worsening economic situation made that untenable by 2001. When the peso was uncoupled from the greenback, its value plummeted, causing a run on banks as people's savings were wiped out, and deadly social unrest. A few days after that devaluation, Argentina defaulted on its foreign debt, further deepening its economic and social crisis. Since then, Argentina has battled with boom and bust cycles, inflation, currency devaluations, and debt restructuring. "We continue despite everything, knowing that for now, things are not going to change," said the teacher Sablich. "That's the saddest thing about being in this country right now, the uncertainty, that we don't know how we're going to get out, who's going to get us out, how we're going to do it." 'A disgrace' Many weary Argentines are backing a radical political outsider in October's presidential race. Buenos Aires lawmaker Javier Milei, who has vowed to dynamite the central bank and dollarize the economy, in August scored the most votes in a joint primary election between all parties, seen as a litmus test for the main vote. His main rivals will be former security minister Patricia Bullrich on the right, and economy minister Massa from the ruling center-left coalition. Bullrich slammed the inflation figures on social media as "a disgrace," saying they "summed up the tragedy" left by Massa and the rest of the government. Massa, scrambling to ease the pressure on citizens' pockets, on Monday announced an increase in the minimum taxable monthly income to 1.7 million pesos ($4,850 official rate, $2300 on the parallel market). This is double the previous amount, and would leave fewer than 800,000 people in the country of 45 million paying income tax, Massa said. The post Argentina monthly inflation highest in three decades appeared first on Daily Tribune......»»
Bank lending declines, consumer loans rise
Bank lending of universal and commercial banks posted slower expansion amid higher money supply in the country, data from Bangko Sentral ng Pilipinas showed on Thursday. Preliminary data showed that domestic liquidity (M3) grew by 5.9 percent year-on-year to about P16.4 trillion in June 2023 from 6.6 percent in May, driven by the sustained expansion in bank lending to non-financial private corporations and households. On a month-on-month seasonally-adjusted basis, M3 increased by about 0.2 percent. Domestic claims rose by 10.1 percent year-on-year in June from 11.4 percent in the previous month. Claims in the private sector grew by 7.9 percent in June from 9.3 percent in May. Net claims on the central government also expanded by 17.2 percent in June from 18.3 percent in May, owing mainly to the borrowings by the National Government. Net foreign assets in peso terms fell by 2.8 percent year-on-year in June following a 2.7-percent expansion in May. The BSP's NFA position declined by 0.6 percent in June after increasing by 4.2 percent in the previous month. Meanwhile, the NFA of banks declined on account of higher bills payable. "Looking ahead, the BSP will continue to ensure that domestic liquidity conditions remain in line with the BSP's price and financial stability objectives," BSP said. Meanwhile, U/KBs' outstanding loans, excluding those placed in the central bank's reverse repurchase facility, grew at a slower rate of 7.8 percent year-on-year in June from 9.4 percent in May due to a continued rise in lending to key sectors. On a month-on-month seasonally-adjusted basis, outstanding universal and commercial bank loans, net of RRPs, increased by 0.6 percent. Outstanding loans to residents, net of RRPs, also increased at a softer pace of 7.9 percent from 9.3 percent in May. Outstanding loans for production activities went up by 6.3 in June, following a 7.9-percent expansion in the previous month due to a continued rise in lending in electricity, gas, steam and airconditioning supply (11.8 percent); wholesale and retail trade, and repair of motor vehicles and motorcycles (9.7 percent); real estate activities (3.8 percent); financial and insurance activities (7.7 percent); and information and communication (11.2 percent). Likewise, outstanding loans to non-residents went up by 4.8 percent in June from 13.2 percent in the previous month. Meanwhile, consumer loans to residents rose at a slightly faster rate of 23.7 percent in June from 22.7 percent in May given the increase in credit card and motor vehicle loans. "The slowdown in credit activity reflects the impact of monetary policy tightening which continues to work its way through the economy," BSP said. "Looking ahead, the BSP remains prepared to ensure that domestic liquidity and lending dynamics are in line with its price and financial stability objectives," BSP added. The post Bank lending declines, consumer loans rise appeared first on Daily Tribune......»»
Gov’t funds inflation measures with loans
Borrowings of the national government from domestic and foreign sources continued to climb as they exceeded the P1-trillion mark in the first half of the year. The loans were purportedly intended for programs to respond to the impact of high prices, mainly through subsidies to the poor. Economists expect prices of basic commodities to remain high as the holiday season approaches. Most of them agreed that the third quarter is considered a period for stockpiling inventories, while the final three months see hefty holiday spending, which both increase price pressures. Bureau of Treasury data showed that actual gross borrowing hit P1.33 trillion during the January–June period, up by 24.3 percent from P1.07 trillion a year ago. In the first half, the government borrowed three times more from domestic sources at P1.06 trillion, while gross external financing reached P366.44 billion. Domestic borrowings came from retail Treasury bonds worth P283.76 billion and fixed-rate bonds worth P686.15 billion. Foreign debts came from project loans totaling P57.76 billion, program loans of P145.06 billion, and global bonds worth an equivalent of P163.6 billion. In June alone, gross financing reached P158.95 billion, up by 14.65 percent from P138.64 billion for the same month in 2022. Gross domestic borrowings reached P143.92 billion in June 2023, a 49.22-percent increase from P96.45 billion a year ago. Broken down, domestic debts came from P125 billion in fixed-rate Treasury bonds and P18.92 billion in Treasury bills. Meanwhile, external gross borrowings declined by 54.61 percent to P22.57 billion from P49.72 billion in the previous year. This consisted of P2.66 billion in program loans and P19.9 billion in new project loans. Government borrowings are okay as long as they are used for productive purposes, according to a previous statement from the Department of Budget and Management. Budget Secretary Amenah Pangandaman earlier said the government’s debt-to-gross domestic product ratio rose at the height of the pandemic because the government had to take out additional debt to fund the health sector. “There is a deficit because you have insufficient revenues and the balance will come from borrowings. So, it’s all interconnected,” Pangandaman said in a vlog. The Development Budget Coordination Committee, or DBCC, has a target to bring down the debt-to-gross domestic product ratio to less than 60 percent by 2025. The post Gov’t funds inflation measures with loans appeared first on Daily Tribune......»»
Research group: Interest cut not likely until Q2 2024 due to inflation risk
A subsidiary of Fitch Solutions said on Friday that cutting the interest rates in the Philippines is too early due to the potential inflationary effects of El Niño in the country. BMI, a division of Fitch Solutions, said in an emailed commentary that the Bangko Sentral ng Pilipinas might not lower its interest rates until next year after it kept its benchmark rate at 6.25 percent during its most recent policy-setting meeting. "With the clear risk to the inflation outlook and the external sector under pressure, policymakers will likely keep financial conditions very restrictive for a while longer," BMI said. "This feeds into our expectations for rate cuts to materialize only in the second quarter of 2024," it added. Although BMI anticipates that inflation will ease to less than 4 percent by the fourth quarter of this year, the start of El Niño "may threaten food prices" in the country. It also mentioned how the weather could raise concerns about the disinflationary process in the Philippines. "In addition to inflation, maintaining currency stability will be a key consideration in the central bank's near-term policy decisions," BMI said. The Fitch Solutions unit added that maintaining currency stability, apart from inflation, will be a key consideration in the central bank's near-term policy decisions. BMI noted that the Philippine peso has depreciated by about 1.9 percent against the US Dollar in the year-to-date and is currently trending towards its one-year low of P59.47 per dollar. "Policymakers will be cautious about exacerbating further weakness in the peso, especially given that the US Federal Reserve has not completely closed the door on further tightening – a key risk that we have been highlighting," BMI said. "These factors will prompt the BSP to keep interest rates at multi-year highs. But this will come at the expense of growth," it added. Meanwhile, BMI reduced its 2023 its growth forecast from 5.9 percent to 5.3 percent in light of "a poor economic performance" in the second quarter. For context, the Philippine economy decelerated by 4.3 percent year-on-year in the second quarter amid slow government spending. Latest data from Philippine Statistics Authority showed that the gross domestic product growth in April to June period was lower than the 7.5 percent recorded in the period last year and the 6.4 percent in the first quarter this year. The country's GDP also shrank by 0.9 percent during the second quarter after expanding by 1.1 percent during the first quarter. "Rate cuts would only be considered when food prices have stabilized, and major central banks have begun their easing cycle, which we expect in the second quarter of 2024," BMI said. The post Research group: Interest cut not likely until Q2 2024 due to inflation risk appeared first on Daily Tribune......»»
New record high: Phl debt at P14.15T in June
The Philippine national government's debt stock reached another record high of P14.15 trillion in June as new domestic borrowings exceeded payments made, the Bureau of Treasury said on Tuesday. Data from the state treasury bureau showed that the country's debt portfolio increased by P51.31 billion or 0.4 percent compared to the previous month, primarily due to the net issuance of domestic securities. Of the total debt stock, 31.4 percent was sourced externally, while 68.6 percent were domestic borrowings. The BTr said the country's domestic debt reached P9.70 trillion, P114.32 billion or 1.2 percent higher than the end-May 2023 level. For the month, domestic debt growth amounted to P114.32 billion due to the net issuance of government bonds driven by the NG's financing requirements. Year-to-date, domestic debt has an increment of P494.44 billion or 5.4 percent The national government's external debt amounted to P4.45 trillion, P63.01 billion or 1.4 percent lower than the previous month. "The reduction in foreign debt was driven by the impact of currency adjustments affecting both USD (US Dollar)- and third-currency equivalents leading to a decrease in the peso value of the debt, amounting to P69.98 billion and P8.28 billion, respectively," the BTr said, adding that these offsets the availing of foreign loans worth P15.25 billion. NG's external debt likewise increased by P234.55 billion or 5.6 percent from the end-December 2022 level. Total NG guaranteed obligations decreased by P9.98 billion or 2.6 percent month-on-month to P369.73 billion as of June 2023. For the month, the decline in guaranteed debt was attributed to the net repayment of both domestic and external guarantees amounting to P4.36 billion and P0.89 billion, respectively. "This was further trimmed because of the effect of currency adjustments on both USD- and third- currency-denominated guarantees amounting to P2.78 billion and P1.95 billion, respectively," BTr said. From the end-December 2022 level, NG guaranteed debt has decreased by P29.32 billion or 7.3 percent. In an emailed commentary, Rizal Commercial Banking Corp. chief economist Michael Ricafort said the latest net borrowings of the national government may reflect the need to finance the still relatively wider budget deficits in recent months partly due to the lower individual tax rates for most income brackets since the start of 2023. "New official development assistance and other multilateral funding, especially for the country's various infrastructure projects, would also add to the country's outstanding national government debt in the coming months," Ricafort said. China Banking Corp. chief economist Domini Velasquez echoed Ricafort's comment in another Viber message, saying that the government had to incur debt in a high-interest rate environment in the first six months of the year to finance government projects and programs and augment budget deficits. "On a positive note, we think market interest rates are already on a downtrend as domestic inflation moves down and major central banks near the end of their tightening cycles. This will help dampen debt growth," Velasquez said. The post New record high: Phl debt at P14.15T in June appeared first on Daily Tribune......»»
Phl net external liability widens to P2-trillion
The Philippines' net external liability position widened by 29.9 percent in the fourth quarter of 2022 due to the higher net external liability positions of Non-Financial Corporations (NFCs) and the General Government (GG), as well as the lower net external asset position of the central bank (CB), the Bangko Sentral ng Pilipinas (BSP) said. The latest data from BSP showed earlier this week that the country's net external liability position rose to P2 trillion in the fourth quarter (Q4) of last year from P1.5 trillion in the third quarter (Q3) of 2022. By sector, the NFCs remained the largest net debtor in the domestic economy at P8.5 trillion in Q4 2022 from P8.1 trillion in Q3 2022 due to the sector's higher net indebtedness against the ROW. "This arose from the expansion in the NFCs' gross external liabilities and its lower external assets. The sector's external assets and liabilities were mostly comprised of loans and equity securities," BSP explained in a statement. In Q4 2022, the NFCs' liabilities-to-GDP ratio decreased slightly to 91.1 percent as the economy's growth in nominal terms exceeded the increase in the sector's gross financial liabilities. On a year-on-year basis, the NFCs' net debtor position widened due to its higher net indebtedness to the ODCs. "This resulted mainly from the rise in bank loans availed to sustain operations amid heightened consumer demand brought about by the improved economic outlook," BSP said. The GG's net debtor position widened to P8.2 trillion in Q4 2022 from P7.7 trillion in Q3 2022 due to the sector's deposit withdrawals from the CB, which it used to meet its higher operating expenditures during the last quarter of the year. "The GG remained partly insulated from exchange rate fluctuations as the majority of its liabilities were funded by the domestic sectors," BSP said. Notwithstanding the record-high debt levels, the growth in the GDP outpaced the increase in the GG's level of borrowings in Q4 2022. As a result, the sector's liabilities-to-GDP ratio for the quarter decreased to 62.7 percent. Year on year, the GG's net debtor position rose primarily due to the increase in loans from the ROW and higher GS issuances. The households (HHs) continued to be the top creditor of the economy at P11.9 trillion in Q4 2022 from P11.4 trillion in Q3 2022. The HHs' net claims on the CB, which were composed mainly of the sector's currency holdings, increased. Amid the steady increase in the HHs' assets, the sector's gross financial liabilities registered double-digit YoY growth rates for the last two quarters of 2022 – the fastest recorded since Q1 2020. This coincided with the steeper increase in prices as headline inflation accelerated to 7.9 percent in Q4 2022. The ODCs' net creditor position eased to P1.89 trillion in Q4 2022 from P1.95 trillion in Q3 2022. In Q4 2022, the sector's net claims on the GG declined due to the increase in the GG's deposits in banks. Meanwhile, the ODCs' net debtor position to the OFCs widened on the back of the OFCs' higher deposit placements with the ODCs. Similarly, on a YoY basis, the sector's net creditor position contracted, brought about by the annual increase in deposits from the HHs and OFCs. The CB's net creditor position contracted to P811.4 billion in Q4 2022 from P937.9 billion in Q3 2022 as its net financial liability positions to the ODCs and the HHs increased. "The CB's higher financial liabilities to these counterparty sectors were due mainly to the expansion in the deposits of the ODCs and currency holdings of the HHs. These developments were mitigated by the increase in the CB's net financial asset position with the GG, which resulted from the substantial decline in deposits from the NG. However, on a YoY basis, the CB's net creditor position increased mainly due to the NG's deposit withdrawals. The post Phl net external liability widens to P2-trillion appeared first on Daily Tribune......»»
Outlook dims, Asia estimates reduced
The Asian Development Bank had cut its forecast for economic growth in developing Asia for next year, but it kept its estimates for 2023. The fact that the ADB reduced its estimate for 2024 from 4.8 percent to 4.7 percent showed that the global outlook is “dimmed by the delayed effects of interest rate hikes.” In an update to its Asian Development Outlook report, which came out on Wednesday, the ADB said that it still expects the region to grow by 4.8 percent in 2023, which is the same as what it said in April. “Exports from developing Asia weakened in the first quarter of 2023 as global demand slowed,” the Manila-based multilateral lender said. “However, consumption and investment are forecast to boost aggregate regional growth,” it added. Prices cooling This year, the region’s overall inflation is expected to slow down to 3.6 percent, which is much less than the 4.2 percent predicted last year. Prices should go up by 3.4 percent next year. As supply-side forces went down and monetary tightening took hold, the ADB said, headline inflation went back to where it was before the pandemic. The ADB said that most central banks have kept their policy rates the same this year and that “signs have emerged of a shift toward easing.” The biggest economy in the area, China, is expected to grow by 5 percent this year and 4.5 percent next year, which is the same as what was projected in April. “Growth in manufacturing investment is expected to moderate in line with cooling exports, while that of infrastructure investment is likely to remain stable,” the ADB said of China’s outlook. “Monetary and fiscal policies will continue to support economic recovery, particularly to boost domestic demand.” This year, the economy of the trade-dependent Southeast Asian country Vietnam is expected to grow slowly to 5.8 percent, down from 6.5 percent in April. The ADB says it will grow by 6.2 percent next year, which is less than the 6.8 percent growth rate that was predicted before. ADB also kept the growth predictions for India, one of the largest economies in the region at 6.4 percent and 6.7 percent, respectively, “supported by upbeat domestic demand.” The post Outlook dims, Asia estimates reduced appeared first on Daily Tribune......»»
Global outlook dims, ADB cuts growth estimates from 4.8 percent to 4.7
The Asian Development Bank cut its forecast for economic growth in developing Asia for next year, but it kept its estimates for 2023. The fact that the ADB cut its estimate for 2024 from 4.8 percent to 4.7 percent shows that the global outlook is "dimmed by the delayed effects of interest rate hikes." In an update to its Asian Development Outlook report, which came out on Wednesday, the ADB said that it still expects the region to grow by 4.8 percent in 2023, which is the same as what it said in April. "Exports from developing Asia weakened in the first quarter of 2023 as global demand slowed," the Manila-based multilateral lender said. "However, consumption and investment are forecast to boost aggregate regional growth," it added. This year, the region's overall inflation is expected to slow down to 3.6 percent, which is much less than the 4.2 percent predicted last year. Prices should go up by 3.4 percent next year. As supply-side forces went down and monetary tightening took hold, the ADB said, headline inflation went back to where it was before the pandemic. The ADB said that most central banks have kept their policy rates the same this year and that "signs have emerged of a shift toward easing." The biggest economy in the area, China, is expected to grow by 5 percent this year and 4.5 percent next year, which is the same as what was predicted in April. "Growth in manufacturing investment is expected to moderate in line with cooling exports, while that of infrastructure investment is likely to remain stable," the ADB said of China's outlook. "Monetary and fiscal policies will continue to support economic recovery, particularly to boost domestic demand." This year, the economy of the trade-dependent Southeast Asian country Vietnam is expected to grow slow to 5.8 percent, down from 6.5 percent in April. The ADB says it will grow by 6.2% next year, which is less than the 6.8% growth rate that was predicted before. ADB also kept the growth predictions for India, one of the largest economies in the region at 6.4 percent and 6.7 percent respectively, "supported by upbeat domestic demand." The post Global outlook dims, ADB cuts growth estimates from 4.8 percent to 4.7 appeared first on Daily Tribune......»»
ADB cuts inflation forecast for developing Asia
The Asian Development Bank cut its inflation forecast for developing Asia on Wednesday, as food and fuel prices eased, supply chain disruptions waned and interest rate hikes started to bite. Inflation, which has squeezed household budgets and left millions of poor households struggling to put food on the table, is heading back towards pre-Covid levels, the Philippines-based lender said. It expects inflation of 3.6 percent this year, compared with its forecast in April of 4.2 percent as prices in China ease sharply, the bank said in its flagship outlook report. Developing Asia refers to the multilateral lender's 46 emerging member economies, stretching from Kazakhstan in Central Asia to the Cook Islands in the Pacific. The ADB kept its economic growth forecast of 4.8 percent for 2023, citing robust consumption, travel, and investment, even as global demand for the regions' exports weakened. Further upside to its forecast was possible, the bank said. "If inflation is tamed more quickly than currently expected in the advanced economies, the authorities there would likely adopt a more dovish monetary policy, which would support growth in the region," ADB said. At the same time, the lender warned an escalation in Russia's invasion of Ukraine could fuel price hikes, while the return of the El Nino weather phenomenon this year could hurt economies. The tide was also turning on interest rates, the bank noted. "With lower inflation in developing Asia and more moderate monetary tightening in the United States, most central banks in the region have kept policy rates steady this year, with signs emerging of a shift toward easier money," it said. China, the world's second-largest economy, is still expected to grow at five percent this year and 4.5 percent in 2024, the bank said, citing supportive monetary and fiscal policies. The post ADB cuts inflation forecast for developing Asia appeared first on Daily Tribune......»»
Philippines’ Marcos signs $9 bn wealth fund into law
Philippine President Ferdinand Marcos on Tuesday signed into law a bill creating a $9 billion sovereign wealth fund aimed at boosting economic growth and infrastructure spending, but critics warned it will be prone to misuse. Marcos had pushed Congress for swift approval of the bill, which was filed by his son and cousin late last year. During a signing ceremony at the presidential palace, Marcos said the fund would "leverage a small fraction" of the government's money without adding to the country's debt burden. "We will leverage on a small fraction of the considerable but underutilized investable funds of government and stimulate the economy without the disadvantage of having additional fiscal and debt burden," Marcos said, less a week before he is due to deliver his second State of the Nation address. But a small group of protesters rallied near the palace in opposition to the law, claiming the fund was a "deception" and would put public money "in danger". The 500-billion-peso "Maharlika Investment Fund" will draw most of its funds from the national government, including the central bank, gaming revenue and two state-owned banks. Private banks and companies will also be allowed to invest. The original proposal was for a $4.9 billion fund that would be partly bankrolled by state-run pensions for government and private-sector workers, sparking public fears that retirement savings could be put at risk. The final version of the bill approved by Congress in May said pension funds would not have to contribute. The fund will be allowed to make a wide range of investments, including in corporate bonds, equities, joint ventures, and infrastructure projects. Marcos said Tuesday the fund would help the government achieve its economic growth targets and reduce reliance on foreign borrowings to pay for new roads and bridges. He insisted the fund would be transparent and only top finance professionals would be hired to manage it. "I assure you that the resources entrusted to the fund are taken care of with utmost prudence and integrity," Marcos said. Conventional sovereign wealth funds are seeded by windfall government profits from natural resources such as oil or minerals. The word "maharlika" is widely associated with Marcos Jr's late dictator father and namesake, who presided over widespread human rights abuses and corruption during his two decades in power. He was ousted in 1986. Marcos Sr claimed to have led an anti-Japanese guerrilla unit called Ang Mga Maharlika during World War II, but he has been accused of lying about his war record. mff/amj/dan © Agence France-Presse The post Philippines’ Marcos signs $9 bn wealth fund into law appeared first on Daily Tribune......»»
OFW monies reach $2.78B
Cash remittances coursed through banks increased in May following the growth in receipts from workers abroad. Data from the Bangko Sentral ng Pilipinas on Monday showed that overseas Filipino remittances reached $2.78 billion in May 2023, higher by 2.9 percent than the $2.70 billion registered in the same month last year. “The expansion in cash remittances in May 2023 was due to the growth in receipts from land- and sea-based workers,” BSP said in a statement. Consequently, personal remittances for the first five months of the year grew by 3.1 percent to $14.46 billion, from $14.02 billion posted in the comparable period in 2022. On a year-to-date basis, cash remittances reached $12.98 billion, 3.1 percent higher than the year-ago level of $12.59 billion. “The growth in cash remittances from the United States, Singapore, and Saudi Arabia contributed mainly to the increase in remittances in the first five months of 2023,” BSP said. “Meanwhile, in terms of country sources, the US posted the highest share of overall remittances during the period, followed by Singapore, Saudi Arabia and Japan,” BSP added. In an emailed commentary, Rizal Commercial Banking Corp. chief economist Michael Ricafort said the continued growth in the year-on-year overseas Filipino remittances might have to do with increased holiday-related spending since the Holy Week in April 2023. “More people travel to go back to their respective hometowns in the provinces for vacations, also during the school break (June to July), spend for gatherings/reunions, as well as finance vacations locally or overseas,” Ricafort said. He added that relatively higher inflation also required sending more money to families and dependents in the Philippines. Ricafort said that further reopening the economy towards greater normalcy also led to increased spending with some pent-up demand or revenge spending by OFW families and dependents that were partly financed with the increased OFW remittances. Meanwhile, President Ferdinand Marcos Jr. on Monday encouraged overseas Filipinos to return to the Philippines, citing the “great many opportunities” for them here. During the courtesy call of 2023 Very Important Pinoy Tour participants in Malacañang, Marcos encouraged overseas Filipinos to come home and bring their children back to the Philippines so that they could learn about Filipino culture. “There are a great many opportunities for you and for the country as we try to transform the economy,” Marcos said. “I encourage you to come back and see what is happening in the Philippines,” he added. He also praised the contributions of overseas Filipinos to the Philippines, saying that they were “practically parts of their families.” “In every part of the societies that we Filipinos have decided to go to, we have made a very good name for ourselves,” Marcos said. “And for that, we thank our Filipino brothers and sisters who live abroad and continue to make the name of the Philippines shine.” Marcos added that Filipinos worldwide have become and continue to become an essential part of Philippine society and of the places where they decided to live and work. Per its website, the VIP Tour is led by the Department of Foreign Affairs in collaboration with the Department of Tourism and Rajah Tours. The current year’s travel plan blends the finest attractions of Metropolitan Manila, Iloilo and Boracay, offering participants a thrilling and educational vacation experience. The post OFW monies reach $2.78B appeared first on Daily Tribune......»»
Remittances reach P2.78B, rise by 2.9%
PAMPANGA – Cash remittances coursed through banks increased in May following the growth in receipts from workers abroad. Data from Bangko Sentral ng Pilipinas showed on Monday that overseas Filipino remittances reached $2.78 billion in May 2023, higher by 2.9 percent than the $2.70 billion registered in the same month last year. "The expansion in cash remittances in May 2023 was due to the growth in receipts from land- and sea-based workers," BSP said in a statement. Consequently, personal remittances for the first five months of the year grew by 3.1 percent to $14.46 billion, from $14.02 billion posted in the comparable period in 2022. On a year-to-date basis, cash remittances reached $12.98 billion, 3.1 percent higher than the year-ago level of $12.59 billion. "The growth in cash remittances from the United States, Singapore, and Saudi Arabia contributed mainly to the increase in remittances in the first five months of 2023," BSP said. "Meanwhile, in terms of country sources, the U.S. posted the highest share of overall remittances during the period, followed by Singapore, Saudi Arabia, and Japan," BSP added. In an emailed commentary, Rizal Commercial Banking Corp. chief economist Michael Ricafort said the continued growth in the year-on-year overseas Filipino remittances growth might have to do with increased OFW remittances sent back home in May 2023 in time to finance holiday-related spending continued since the Holy Week in April 2023. "More people travel to go back to their respective hometowns in the provinces for vacations, also during the school break (June to July), spend for gatherings/reunions, as well as finance vacations locally or overseas," Ricafort said. He added that relatively higher inflation also required sending more overseas Filipino remittances to families and dependents in the Philippines. Ricafort said further reopening the economy towards greater normalcy also led to increased spending with some pent-up demand or even some revenge spending by OFW families and dependents locally that are partly financed by increased sending OFW remittances. The post Remittances reach P2.78B, rise by 2.9% appeared first on Daily Tribune......»»
5-month debts breach P1T
Gross financing of the national government had reached the P1-trillion threshold in the first five months of the year due to higher domestic borrowings, data from the Bureau of the Treasury showed over the weekend. From January to May 2022, actual gross financing hit P1.17 trillion as gross domestic borrowings amounted to P912.577 billion, while external debts reached P343.874 billion. Retail Treasury bonds worth P283.763 billion and fixed-rate bonds worth P561.150 billion were both issued to raise funds from domestic sources. Project loans totaling P37.872 billion, program loans of P142.395 billion, and global bonds comprising P163.607 billion made up the entire amount of external funding. Meanwhile, the Marcos administration’s actual gross financing for May 2023 increased month-on-month by 13.13 percent to higher domestic borrowings. Higher May borrowings The same data from BTr revealed that the government’s gross borrowings in May reached P141.671 billion from April’s P125.230 billion. Local borrowings in May rose 37.10 percent month-on-month to P131.792 billion with the issuance of treasury bills worth P31.792 billion and fixed-rate treasury bonds worth P100.000 billion. Gross loans from the international donor community reached P14.991 billion, or 55.62 percent lower than P33.779 billion last month. The gross external financing is composed of project loans worth P5.893 billion and program loans worth P9.098 billion. The post 5-month debts breach P1T appeared first on Daily Tribune......»»
Gov’t financing surpasses P1-trillion mark from Jan-May
National government financing has already reached the P1-trillion threshold in the first five months of the year due to higher domestic borrowings, data from the Bureau of the Treasury showed. From January to May 2022, actual net financing hit P1.168 trillion, with net domestic borrowings amounting to P880.315 billion and net external financing reaching P287.364 billion. Retail Treasury bonds worth P283.763 billion and fixed-rate bonds worth P561.150 billion were both issued to raise funds from domestic sources. Project loans totaling P37.872 billion, program loans of P142.395 billion, and global bonds comprising P163.607 billion made up the entire amount of external funding. Meanwhile, the Marcos administration's actual financing for May 2023 increased month-on-month by 13.13 percent to higher domestic borrowings. The same data from BTr revealed that government borrowings in May reached P141.671 billion from April's P125.230 billion. Local borrowings in May rose 37.10 percent month-on-month to P131.792 billion with the issuance of treasury bills worth P31.792 billion and fixed-rate treasury bonds worth P100 billion. Gross loans from the international donor community reached P14.991 billion, or 55.62 percent lower than P33.779 billion last month. The gross external financing is composed of project loans worth P5.893 billion and program loans worth P9.098 billion. The post Gov’t financing surpasses P1-trillion mark from Jan-May appeared first on Daily Tribune......»»
Monetary Board approves government’s $2.73-B borrowings
The Monetary Board, the policy-making body of the Bangko Sentral ng Pilipinas, approved the government's borrowing in the second quarter to fund various railway projects across the country. In a statement on Friday, the BSP said it approved the government's borrowing of $2.73 billion in the second quarter, which is 23 percent lower than the borrowing amount during the same period in 2022, which was $3.54 billion. “These are all borrowings by the Republic of the Philippines consisting of three project loans from the Japan International Cooperation Agency. These borrowings will fund various railway projects of the NG (national government),” the BSP explained. For comparison, the BSP in April reported $5.56 billion in public sector foreign borrowings in the first quarter, up 16 percent from last year's $4.8 billion. Public sector borrowings comprise a combination of project loans and program loans. These borrowings also involve the issuance of sovereign bonds to fulfill the national government's general financing needs, which include addressing the impacts of the COVID-19 pandemic and funding infrastructure-related projects. Most of the country's borrowings primarily originate from domestic creditors to protect the national government from the unpredictable fluctuations of exchange rates and other factors. Foreign loans necessitate the approval of the BSP through its Monetary Board before the national government can guarantee them. According to data from the BSP, the country's foreign debt reached a record high of $118.81 billion in the first quarter. To ensure that the level of foreign debt remains within manageable limits, the BSP is responsible for reviewing and approving all public sector or government foreign borrowings following Section 20, Article VII of the 1987 Philippine Constitution. The BSP has emphasized its commitment to promoting the prudent utilization of resources and ensuring that the country's external debt requirements are maintained at manageable levels to support external debt sustainability. The post Monetary Board approves government’s $2.73-B borrowings appeared first on Daily Tribune......»»