The Bangko Sentral ng Pilipinas (BSP) reported that the country’s gross international reserves (GIR) reverted in March to $100 billion and hit its highest level in two months.
Preliminary data released by the BSP showed that the country’s foreign exchange buffer rose to $100.2 billion in March, the highest since January, from $98.2 billion in February.
BSP Governor Felipe Medalla said the month-on-month increase in GIR level is a reflection of the national government’s net foreign currency deposits with the central bank, the upward revaluation of the BSP’s gold holdings due to the increase in the price of gold in the international market, and net income from the BSP’s investments abroad.
“The latest GIR level represents a more than adequate external liquidity buffer,” Medalla said in a statement.
The buffer, according to the BSP, is equivalent to 7.5 months’ worth of imports of goods and payments of services and primary income.
The GIR level is also about six times the country’s short-term external debt based on original maturity and 4.2 times based on residual maturity.
The GIR refers to the US dollar value of holdings of foreign exchange, special drawing rights, reserve position in the International Monetary Fund (IMF), and gold at the end of a given period.
After hitting an all-time high of $110.12 billion in 2020, the FX buffer has steadily declined to $108.79 billion in 2021 and $96.15 billion in 2022.
After exceeding its $93 billion target last year, the BSP sees the GIR level hitting $100 billion in 2023 and $102 billion in 2024.
The BSP dipped into the buffer and actively intervene in the foreign exchange market as the peso weakened to an all-time low of P59 to P1 last October.
