Philippines’ stock of US dollars dropped by $630 million to $103.437 billion as of end-April compared to end-March’s $104.067 billion after the government withdrew foreign currency from the Bangko Sentral ng Pilipinas (BSP) to pay for maturing loans and to fund expenditures.
Despite the month-on-month decline, the BSP data also showed that the country’s current dollar reserves or gross international reserves (GIR) is still higher by $1.677 billion from same four-month period last year of $101.760 billion.
The country’s reserves remain adequate based on the BSP and International Monetary Fund (IMF) standards.
“The latest GIR level represents a more than adequate external liquidity buffer equivalent to 7.7 months’ worth of imports of goods and payments of services and primary income. Moreover, it is also about 5.9 times the country’s short-term external debt based on original maturity and 3.6 times based on residual maturity,” said the BSP on Wednesday, May 8.
The month-on-month decrease in the GIR level reflected mainly the National Government’s (NG) net foreign currency withdrawals from its deposits with the BSP to settle its foreign currency debt obligations and pay for its various expenditures, the BSP added.
As to the net international reserves (NIR), this decreased by $633 million to $103.396 billion from end-March’s $104.029 billion. The NIR refers to the difference between the BSP’s reserve assets and reserve liabilities which are the short-term foreign debt and credit and loans from the IMF.
The GIR consists of foreign investments, gold, foreign exchange, reserve position in the IMF, and special drawing rights (SDRs) which is the IMF’s reserve assets.
As of end-April, the BSP’s gold reserves amounted to $10.225 billion, down from $10.531 billion in end-March.
BSP’s foreign investments mainly in securities and bonds totalled $87.887 billion, also lower from $87.944 billion in the previous month.
The central bank has foreign exchange of $791.7 million which was lower from $1.083 billion in end-March.
The BSP’s reserve position in the IMF totalled $736.1 million as of end-April while SDR holdings remained at $3.76 billion. The amount changes only depending on the SDR conversion rate.
For this year, the BSP has a GIR forecast of $102 billion.
In 2023, the country’s GIR totaled $103.753 billion, up from $96.149 billion in 2022. So far, the highest GIR level was recorded at $108.794 billion in 2021.