Philippine Reserves Dip to $112.43 Billion

The country’s gross international reserves (GIR) level, based on preliminary data, settled at $112.43 billion as of end-October 2024, down from $112.71 billion at end-September 2024.

The latest GIR level provides an external liquidity buffer equivalent to 8.1 months’ worth of imports of goods and payments of services and primary income.

It is also about 4.5 times the country’s short-term external debt based on residual maturity.

The month-on-month decrease in the GIR level was mainly due to the National Government’s net foreign currency withdrawals from its deposits with the Bangko Sentral ng Pilipinas (BSP) to meet foreign debt obligations and other expenditures.

Net international reserves (NIR) also declined by $0.28 billion, reaching $112.39 billion as of end-October 2024 from $112.67 billion at end-September 2024.

The BSP’s reserve assets consist of foreign investments, gold, foreign exchange, reserve positions in the International Monetary Fund (IMF), and special drawing rights.

GIR is deemed adequate if it can cover at least three months’ worth of imports and primary income payments.

Short-term debt based on residual maturity includes outstanding external debt with an original maturity of one year or less, plus principal payments on medium- and long-term loans due within the next 12 months.

The GIR level is considered sufficient if it provides at least 100% coverage for the payment of all short-term foreign liabilities due within the year.

NIR refers to the difference between the BSP’s reserve assets and reserve liabilities, including short-term foreign debt and loans from the IMF.