The country’s front-line foreign currency reserves against potential external-sector imbalances aggregated $81.34 billion in February, the Bangko Sentral ng Pilipinas (BSP) said on Friday.
This compared with reserves amounting only to $80.72 billion the previous month and marked the third time in a series that the stock of foreign-currency reserves had gone up.
“The increase in reserves was due mainly to the national government’s net foreign-currency deposits, and the Bangko Sentral’s foreign-exchange operations and income from investments abroad,” BSP Governor Amando M. Tetangco Jr. said in a statement.
In particular, the February gross international reserves (GIR) was higher than the $80.72 billion reported in January and also from the $80.54 billion reported in February last year. The GIR is a pool of assets the central bank maintains to underwrite maturing external obligations. Gold, special drawing rights, foreign investments and foreign-exchange reserves comprise the country’s foreign-currency buffer.
A higher level of reserves means that the country is in a better position to repay its obligations and serves as a stronger buffer against imbalances brought by external developments.
The central bank said the February GIR level was enough to cover 10.4 months’ worth of imports of goods and payments of services and income.
It was also equivalent to 8.6 times the country’s short-term external debt based on original maturity and six times based on residual maturity.
The BSP also said the GIR could have been higher for the month if this was not partially offset by revaluation adjustments on the BSP’s gold holdings from the decrease in the price of gold in the international market, as well as by the payments made by the national government for its maturing foreign- exchange obligations.
The gold holdings of the BSP dipped from $8.05 billion in January this year, down to only $7.63 billion in February 2015. Likewise, the February value of the BSP’s gold holdings was lower than the $8.33-billion level reported the same month the previous year.
Such reserves were highest in January 2013, when this aggregated $85.27 billion. Its value ebbed and flowed the past many months and had dipped from $80.87 billion in September last year to only $78.67 billion by December,
for example.
Since then, the GIR has steadily climbed to $79.54 billion in January, then on to $80.72 billion the
following February.