The gross international reserves settled at $108.45 billion in January, slightly lower than $108.79 billion in December, pulled down by foreign debts payment and decreased value of the gold holdings of the Bangko Sentral ng Pilipinas.
The BSP said in a statement Friday the latest GIR figure represented a more than adequate external liquidity buffer equivalent to 10.3 months’ worth of imports of goods and payments of services and primary income.
It is also about 8.6 times the country’s short-term external debt based on original maturity and 5.9 times based on residual maturity.
“The month-on-month decrease in the GIR level reflected mainly the national government’s payments of its foreign currency debt obligations and downward adjustment in the value of the BSP’s gold holdings due to the decrease in the price of gold in the international market,” it said.
Data showed that the value of BSP’s gold holdings as of end-January declined to $9.18 billion from $9.3 billion as of end-December 2021.
The net international reserves, which refer to the difference between the BSP’s reserve assets and reserve liabilities, also went down to $108.45 billion in January from $108.79 billion in December.
Michael Ricafort, chief economist of Rizal Commercial Banking Corp., said the GIR in the coming months could rise to new record highs amid the continued growth in the country’s structural inflows from OFW remittances, BPO revenues, foreign tourism revenues, and foreign direct investments.
“Thus, near record-high GIR and prospects of reaching new record highs in the coming months could further strengthen the country’s external position, which is a key pillar for the country’s continued favorable credit ratings for the second straight year,” he said.
Ricafort said the yearly OFW remittances at more than $30 billion and BPO revenues at about $30 billion, or a combined $60 billion of recurring structural inflows of foreign currencies, would be enough to cover the yearly trade deficit/net imports that reached $43.1 billion in 2021, near the record $43.5-billion deficit posted in 2018.
The GIR hit a record $110.1 billion in December 2020.