Coming from a series of meetings with various foreign investor groups in Singapore last week, National Treasurer Omar Cruz told reporters that investors who have thus far adopted a wait-and-see attitude are now actively enthusiastic over the Philippine market.
According to Cruz, "investor enthusiasm" had spread outside hedge funds to real money accounts, encouraged by the liquidity of the country’s bond market.
"The holdings of foreign funds used to account for less than three percent of the total market," Cruz said. "Now they are seeing real improvements in our macro-economic fundamentals and they are excited."
Cruz said the success of the government’s bond swaps which allowed more liquidity into the market and created enough depth to make it attractive to real money accounts further strengthened investor interest in the country.
"We have 10-year bonds that are churning by the billion every day, they are very excited about that," he said. "Especially since our bid and ask spreads are thinning out."
The International Monetary Fund said earlier that investor confidence appeared to be differentiating between specific emerging Asian markets.
IMF senior adviser Masahiko Takeda said the Philippines, in particular, showed stronger rebound than other emerging economies in the region.
"In the Philippines, the rebound following the equity market correction in May and June was proportionately larger than the average rebound in the region," Takeda said. "What it means is that while the rebound was a general phenomenon, the Philippines was also getting additional push from its fiscal consolidation."
The impact of this, according to Cruz, was an immediate build-up of investor interest that would, in turn attract even more interests in the future.