End-March 2023 GIR level rises to US$100.2 billion

The country’s gross international reserves (GIR) level, based on preliminary data, rose to US$100.2 billion as of end-March 2023 from the end-February 2023 level of US$98.2 billion.^[1]

The latest GIR level represents a more than adequate external liquidity buffer equivalent to 7.5 months’ worth of imports of goods and payments of services and primary income.^[2] Moreover, it is also about 6.0 times the country’s short-term external debt based on original maturity and 4.2 times based on residual maturity.^[3], [4]

The month-on-month increase in the GIR level reflected mainly the National Government’s (NG) net foreign currency deposits with the BSP, the upward revaluation of the BSP’s gold holdings due to the increase in the price of gold in the international market, and net income from the BSP’s investments abroad.

Similarly, the net international reserves, which refers to the difference between the BSP’s reserve assets (GIR) and reserve liabilities (short-term foreign debt and credit and loans from the International Monetary Fund (IMF)), increased by US$2.0 billion to US$100.2 billion as of end-March 2023 from the end-February 2023 level of US$98.2 billion.

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^[1]  The BSP’s reserve assets consist of foreign investments, gold, foreign exchange, reserve position in the IMF, and special drawing rights.

^[2]  By convention, GIR is viewed to be adequate if it can finance at least three-months’ worth of the country’s imports of goods and payments of services and primary income.

^[3]  Short-term debt based on residual maturity refers to outstanding external debt with original maturity of one year or less, plus principal payments on medium- and long-term loans of the public and private sectors falling due within the next 12 months.

^[4]   The level of GIR, as of a particular period, is considered adequate, 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.