The gross international reserves (GIR) of the Philippines settled at $112.43 billion as of end-October 2024 from the end-September 2024 level of $112.71 billion, the Bangko Sentral ng Pilipinas (BSP) said Friday.
Data showed that on a year-on-year basis, the GIR increased from $101 billion in October 2023. The BSP’s reserve assets include the BSP’s foreign investments, gold, foreign exchange, reserve position in the IMF and special drawing rights.
“The latest GIR level represents a more than adequate external liquidity buffer equivalent to 8.1 months’ worth of imports of goods and payments of services and primary income. Moreover, it is also about 4.5 times the country’s short-term external debt based on residual maturity,” the BSP said.
Michael Ricafort, chief economist of Rizal Commercial Banking Corp., said the proceeds of the national government’s $2.5 billion global (ROP) bond issuance contributed to the GIR in September 2024 .
“For the coming months, GIR could still increase due to the remaining $500-million global [ROP] bond issuance programmed for the rest of 2024, adding to the country’s balance of payments [BOP] and GIR,” Ricafort said.
“Still, relatively high GIR may further strengthen the country’s external position, which in turn, fundamentally supports the country’s favorable credit ratings as seen recently,” he said.
GIR is viewed to be adequate if it can finance at least three-months’ worth of the country’s imports of goods and payments of services and primary income.
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.
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 level of GIR, as of a particular period, is considered adequate, if it provides at least 100 percent cover for the payment of the country’s foreign liabilities, public and private, falling due within the immediate twelve-month period.
The net international reserves (NIR) declined slightly by $280 million to $112.39 billion as of end-October 2024 from the end-September 2024 level of $112.67 billion
NIR refers to the difference between the BSP’s reserve assets (GIR) and reserve liabilities (short-term foreign debt and credit and loans from the IMF.
