Foreign reserves hit a record $85.28 billion in June, as Bangko Sentral ng Pilipinas revised the data amid the rise in gold prices and fluctuation in exchange rates.
Data from Bangko Sentral showed the gross international reserves in June were revised upward from the earlier estimate of $83.97 billion, following the sudden spike in gold prices as investors sought the safety of the bullion market.
Bangko Sentral Governor Amando Tetangco Jr. said in a news briefing Tuesday noted a marked improvement in the price of gold overseas.
Gold price reached a two-year high, as investors sought safe-haven assets amid concerns over Britain’s decision to leave the European Union.
Data showed the price of gold climbed to more than $1,300 per troy ounce in June from less than $1,200 in the previous months.
Tetangco said the revision pushed up the GIR to an all-time high in June, eclipsing the $85.268 billion registered in January 2013. It was also above Bangko Sentral’s target of $82.7 billion this year.
The country’s foreign reserves exceeded its foreign debt estimated at $77.6 billion as of end-March. This means that the Philippines is a net lender to the world.
Bangko Sentral said at $85.28 billion, the GIR in June could cover 10.3 months’ worth of imports of goods and payments of services and income. It was also equivalent to 5.9 times the country’s short-term external debt based on original maturity and 4.3 times based on residual maturity.
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.
GIR ended 2015 at $80.66 billion, up from $79.54 billion a year ago. Bangko Sentral said earlier reserves were expected to reach $82.7 billion by end-2016, or equivalent to nine months worth of imports.
Bangko Sentral said the sustained balance of payments surplus would support the rise in GIR, which is used to stabilize the exchange rate. Bangko Sentral accumulates dollar holdings to prevent the rapid appreciation of the peso against other currencies.
Bangko Sentral said the BoP was expected to yield a surplus of $2 billion in 2016, or the same level in 2015.
The current account is also expected to register a surplus of $5.8 billion this year, equivalent to 1.9 percent of gross domestic product, slightly higher than the actual $5.7 billion registered in 2015.