BOP gap narrows in April

Upgrade to High-Speed Internet for only ₱1499/month!

Enjoy up to 100 Mbps fiber broadband, perfect for browsing, streaming, and gaming.

Visit Suniway.ph to learn

May 20, 2026 | 12:00am

MANILA, Philippines — The Philippines’ balance of payments (BOP) deficit narrowed in April from a year earlier, although the shortfall for the first four months widened as external pressures continued to weigh on the country’s transactions with the rest of the world.

Data from the Bangko Sentral ng Pilipinas (BSP) showed the country posted a BOP deficit of $2.12 billion in April, 17.2 percent smaller than the $2.56-billion gap recorded in the same month last year.

The April shortfall, however, was still the fifth straight monthly deficit after the $2.64-billion deficit in March and $2.28-billion gap in February.

The BOP measures the country’s economic transactions with the rest of the world over a given period. A deficit indicates that more foreign exchange flowed out of the country than came in.

Despite the narrower monthly gap, the cumulative BOP deficit widened by 34.2 percent to $7.41 billion during the January to April period from last year’s $5.52-billion shortfall.

“The narrower BOP deficit in April reflects some normalization after earlier outflows, but the wider year-to-date gap highlights persistent external pressures, particularly from the country’s large trade deficit amid strong import demand and softer exports,” UnionBank chief economist Ruben Carlo Asuncion said.

He said the pressure largely reflects the country’s wide trade gap, as strong import demand and softer exports continued to pull foreign exchange out of the economy. Remittances and services exports provided some support, but were not enough to fully offset the current account deficit, while capital flows remained vulnerable to shifts in global financial conditions.

“Moving forward, the BOP is likely to stay under pressure, although we may see some moderation in the coming months as inflows stabilize and seasonal forex receipts improve,” Asuncion added.

The wider year-to-date deficit also came as the country’s gross international reserves (GIR) declined to a revised $104.33 billion as of end-April, lower by 2.2 percent from $106.64 billion in March.

Compared with April 2025, the reserve buffer inched down by 0.9 percent from $105.31 billion. The latest GIR level was also the lowest in 15 months or since January 2025, when reserves stood at $103.27 billion.

GIR refers to foreign-denominated securities, foreign exchange and other reserve assets, including gold. These reserves help ensure sufficient dollar liquidity to meet the country’s import needs and foreign debt obligations, address currency volatility and provide a buffer against external economic shocks.

The BSP said the end-April reserve level remained a “robust external liquidity buffer,” equivalent to 6.9 months’ worth of imports of goods and payments of services and primary income.

The reserves also covered about 3.8 times the country’s short-term external debt based on residual maturity.

The year-on-year decline in reserves was driven largely by lower foreign investments and foreign exchange holdings, partly offset by the sharp increase in gold reserves.

Foreign investments, which made up the bulk of the GIR, fell by 8.4 percent to $79.40 billion in April from $86.67 billion in the same month last year. Foreign exchange holdings also dropped by 30.2 percent to $469 million from $672.3 million a year ago.

These decreases were partly cushioned by higher gold holdings, which surged by 48.3 percent to $19.78 billion from $13.34 billion in April 2025.

The final April GIR figure of $104.33 billion was slightly higher than the preliminary $104.13 billion reported by the BSP earlier this month, reflecting revisions in the final international reserves report.