THE Philippines’ gross international reserves (GIR) recovered in June after hitting a 16-month low a month earlier, the Bangko Sentral ng Pilipinas (BSP) reported late on Tuesday.
Data showed that GIR had risen to $104.8 billion from $103.98 billion, attributed mainly to the national government’s (NG) higher net foreign currency deposits and an increase in net earnings from the central bank’s overseas investments.
“These were partly offset, however, by the downward valuation adjustments, primarily driven by changes in prices of the BSP’s gold holdings and foreign currency-denominated reserve assets, and NG’s drawdowns on its foreign currency deposits with the BSP for external debt service,” the central bank said.
The BSP said the latest level was enough for 6.8 months’ worth of imports of goods and payments of services and primary income. It can also cover about 3.7 times the country’s short-term external debt based on residual maturity, it added.
The reserves, the BSP also said, “provide sufficient foreign currency to meet the country’s import needs, service its external debt obligations, and serve as a buffer against external economic shocks.” The GIR level is considered adequate if “it can finance at least three months’ worth of the country’s imports of goods and payments of services and primary income.” It is also considered sufficient “if it provides at least 100-percent cover for the payment of the country’s foreign liabilities, public and private, falling due within the immediate twelve-month period.” The central bank expects GIR to end 2026 at $104 billion and rise to $105 billion next year.
