THE country’s gross international reserves (GIR) as of end-January again breached the $80-billion mark due to the net foreign-currency deposits of the government and the increase in the international price of gold.
Data released by the Bangko Sentral ng Pilipinas (BSP) on Thursday showed that the country’s dollar reserves during the period rose to $82.13 billion, from $79.19 billion in December 2018.
The BSP said its income from investments abroad and its foreign-exchange operations also boosted the country’s dollar reserves in January. “However, the increase in reserves was partially tempered by payments by the national government for servicing its foreign-exchange obligations,” BSP Governor Nestor A. Espenilla Jr. said in a statement.
The country’s dollar reserves started to fall below the $80-billion mark in April, when dollar reserves dropped to $79.6 billion, from $80.51 billion in March.
The lowest GIR level in 2018 was registered in October, when it fell to $74.71 billion. The peso was also at its worst in October, when it traded at 54.009 to a dollar.
The Central Bank keeps a certain volume of GIR as it will be used to maintain liquidity in case of an economic crisis. This ensures that the country has enough dollars for imports and prevents shortages should instability arise.
The BSP said the end-January level of GIR continues to serve as an “ample” external liquidity buffer and is equivalent to 7.2 months’ worth of imports of goods and payments of services and primary income.
“It is also equivalent to 6.2 times the country’s short-term external debt based on original maturity and 4.2 times based on residual maturity,” it added.
Net international reserves, which refer to the difference between the BSP’s GIR and total short-term liabilities, likewise rose by $2.94 billion to $82.13 billion as of end-January 2019, from the end-December 2018 level of $79.19 billion.
Image credits: Nonie Reyes