Philippine reserves fall to USD 97.4 billion

MANILA — The Philippines’ gross international reserves fell to a preliminary USD 97.4 billion at end-October.

The decline came as the Bangko Sentral ng Pilipinas conducted net foreign exchange operations, gold lost value, and the national government withdrew foreign currency for debt service and other funding needs.

The reserve stock was USD 2.14 billion, or 2.2%, lower than September’s USD 99.49 billion.

It was USD 12.90 billion, or 11.7%, below October 2025, Daily Guardian calculations based on BSP data showed.

The decline matters because the reserves are the country’s first line of defense for paying for imports and maturing foreign debt when export earnings or overseas financing weaken.

The smaller cushion can leave less room to absorb external shocks that raise the cost of fuel, food, medicine, and machinery imports.

The latest level nevertheless remained above traditional reserve adequacy thresholds.

The International Monetary Fund uses three months of imports and 100% of short-term debt as traditional benchmarks.

The fund warns that reserve needs vary with each country’s risks and policies.

Table 1. Reserve adequacy at a glance

October’s import cover slipped from 6.2 months in September and 7.3 months a year earlier.

Coverage of short-term external debt based on residual maturity eased to 310.3% from 312.4% in September and 396.7% in October 2025.

Residual maturity includes debt originally due within one year and principal payments on longer-term public and private loans falling due over the next 12 months.

The BSP attributed the decline to its net foreign exchange operations, lower global gold prices, and government withdrawals from foreign currency deposits for external debt service and other funding requirements.

The release did not disclose the amount contributed by each of the three drivers.

BSP data showed that securities fell by USD 1.11 billion in October, gold by USD 869.4 million, and other reserve assets by USD 748.1 million.

Those declines were partly offset by a USD 567.3 million increase in currency and deposits and a USD 32 million rise in the reserve position in the International Monetary Fund.

Special drawing rights decreased by USD 10.6 million.

A lower valuation for gold reduces the reported reserve total even when the central bank does not sell the underlying metal.

Table 2. October reserve components and monthly changes

Securities remained the largest reserve component at USD 62.84 billion, followed by gold at USD 16.95 billion and other reserve assets at USD 9.24 billion.

The remaining stock consisted of USD 3.92 billion in special drawing rights, USD 3.65 billion in currency and deposits, and USD 755.1 million in the reserve position in the fund.

The reserve level has declined by USD 15.91 billion, or 14.1%, from the 2026 peak of USD 113.26 billion in February.

Figure 1. Philippine gross international reserves and cover ratios, 2017 to end-October 2026. Source: Bangko Sentral ng Pilipinas.

The BSP allows the exchange rate to be set by market forces but may buy or sell foreign currency to temper destabilizing swings that could feed inflation or disrupt market order.

Gross international reserves consist of eligible foreign assets held by the central bank, including securities, currency and deposits, gold, special drawing rights, the reserve position in the fund, and other reserve assets.

The October figure is preliminary, and details may not add to the total because of rounding.