Gross international reserves climbed to a two-year high in end-April, on higher gold holdings and foreign investments of Bangko Sentral ng Pilipinas.
Data from Bangko Sentral showed the foreign reserves hit $83.5 billion in April, up by $490 million from $83 billion in March and $80.85 billion a year ago.
Bangko Sentral officer-in-charge and Deputy Governor Vicente Aquino said in a statement the increase in GIR was due mainly to revaluation gains on gold holdings resulting from the increase in the price of the precious metal in the international market.
Bangko Sentral’s gold holdings jumped to $8.152 billion in April from $7.764 billion in March.
Other reasons for the increase in reserves were the net foreign currency deposits by the national government and Bangko Sentral’s income from investments abroad.
Bangko Sentral’s foreign investments, mainly in US securities, reached $71.6 billion in April, up from $71.4 billion in March.
“These were partially offset by payments made by the national government for its maturing foreign exchange obligations,” Aquino said.
The end-April reserves can cover 10.4 months’ worth of imports of goods and payments of services and income. It is also equivalent to 5.5 times the country’s short-term external debt based on original maturity and 4.1 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.
Net international reserves, which refer to the difference between the GIR and total short-term liabilities, also increased by $490 million to $83.45 billion as of end-April from $82.96 billion in March.
Bangko Sentral said earlier it expected reserves to settle at $82.7 billion by end-2016, or equivalent to nine months’ import cover. This would be supported the expected improvement in the overall balance of payments position this year to $2.2 billion from $2 billion in 2015.
The current account this year is expected to remain in surplus at $5.7 billion but lower compared to $8.9 billion in 2015 due mainly to the expected increase in the imports of goods and improvements in the services and secondary income accounts.
