September 07, 2018 at 08:35 pm
Julito G. Rada
THE country’s gross international reserves increased to $77.83 billion at the end of August from $76.72 billion a month ago, due mainly to inflows from the government’s net foreign currency deposits as well as income from investments abroad of the Bangko Sentral ng Pilipinas.
The Bangko Sentral said in a statement Friday the inflows were partially tempered by payments made by the government for its foreign exchange obligations, foreign exchange operations of the central bank and revaluation adjustments on gold holdings resulting from the decrease in the price of the metal in the international market.
“The end-August 2018 level of GIR remains as an adequate external liquidity buffer and is equivalent to 7.5 months’ worth of imports of goods, and payments of services and primary income. It is also equivalent to 6.2 times the country’s short-term external debt based on original maturity and 4.2 times based on residual maturity,” the central bank said.
Net international reserves, which refer to the difference between the Bangko Sentral’s GIR and total short-term liabilities, also increased by $1.11 billion to $77.82 billion as of end-August 2018 from the end-July 2018 level of $76.71 billion.
The Bangko Sentral in May kept the reserves target of $80 billion this year, lower than the $81.5-billion level posted in 2017.
The Bangko Sentral said the reserves level by yearend would be consistent with the revised balance of payments projection of a $1.5-billion deficit from the earlier estimate of a $1-billion surplus.
It said the updated BoP projection incorporated the latest available data and reflected recent and prospective economic developments, both domestic and global. The current account is seen to post a higher deficit of $3.1 billion, equivalent to 0.9 percent of the gross domestic product.
Gross international reserves ended 2017 at $81.5 billion, surpassing the target of $80.7 billion for the year, due mainly to inflows arising from the central bank’s foreign exchange operations and revaluation adjustments on its gold holdings.