MANILA – The country’s gross international reserves (GIR) contracted to a seven-year low in December 2018, partly due to the government’s foreign exchange obligations, the Bangko Sentral ng Pilipinas (BSP) reported.
Data released by the central bank showed the GIR totaled $78.460 billion as of end-December 2018, from $81.569 billion in the same period in 2017.
The GIR is a measure of a country’s ability to settle import payments and service foreign debt.
Foreign reserves hit $75.862 billion in November 2018, the lowest since it was recorded at $75.302 billion in 2011.
“The increase in reserves was partially tempered by payments made by the national government to service its foreign exchange obligations,” the BSP said in a statement accompanying the data.
The month-on-month increase was mainly driven by inflows from the central bank’s foreign exchange operations, net foreign currency deposits by the national government, and revaluation gains from the BSP’s gold holdings.
“The end-December 2018 … GIR continues to serve as ample external liquidity buffer and is equivalent to 6.9 months’ worth of imports of goods and payments of services and primary income,” the BSP said.
“It is also equivalent to 5.8 times the country’s short-term external debt based on original maturity and 4 times based on residual maturity,” it added.
Net international reserves – the difference between the GIR and short-term liabilities – expanded to $78.44 billion as of end-December 2018 from $75.66 billion as of end-November 2018. (GMA News)
