The Philippines’ gross international reserve settled at $103.4 billion as of end-April 2024, down from the end-March 2024 level of $104.1 billion, the Bangko Sentral ng Pilipinas (BSP) said Wednesday.
The BSP said the latest GIR level represented a more than adequate external liquidity buffer equivalent to 7.7 months’ worth of imports of goods and payments of services and primary income.
It was also about 5.9 times the country’s short-term external debt based on original maturity and 3.6 times based on residual maturity.
“The month-on-month decrease in the GIR level reflected mainly the National Government’s (NG) net foreign currency withdrawals from its deposits with the BSP to settle its foreign currency debt obligations and pay for its various expenditures,” the BSP said.
The net international reserves, which refer to the difference between the BSP’s reserve assets and reserve liabilities (short-term foreign debt and credit and loans from the International Monetary Fund, decreased by $0.6 billion to $103.4 billion as of end-April 2024 from the end-March 2024 level of $104 billion.
Rizal Commercial Banking Corp. chief economist Michael Ricafort said the country’s latest GIR was still above the minimum international threshold of 3 to 4 months, which “could still provide greater buffer/support/cushion on the peso exchange rate vs. any speculative attacks.”
“For the coming months, the country’s GIR could still be supported by the continued growth in the country’s structural inflows from OFW remittances, BPO revenues, exports, relatively fast recovery in foreign tourism revenues as well as continued foreign investment/FDI inflows coming from among pre-pandemic highs,” Ricafort said.
He said the still relatively high GIR could strengthen the country’s external position—a key pillar for the country’s continued favorable credit ratings for the second straight year, mostly at 1 to 3 notches above the minimum investment grade.
“It’s] a sign of resilience despite the COVID-19 pandemic that caused downgrades in other countries around the world,” Ricarfort said.