GROSS international reserves (GIR) rose in July to $85.183 billion, up slightly from a month earlier and exceeded the central bank’s estimates for the full year.
July’s GIR was higher than the downwardly-revised $84.932 billion recorded in June and the $76.722 billion from a year earlier, according to preliminary Bangko Sentral ng Pilipinas (BSP) data.
The end-July GIR level beat the central bank’s $83-billion projection for 2019, against the $79.193 billion which the indicator hit at end-2018.
The central bank in a statement attributed GIR growth to inflows arising from the central bank’s foreign exchange operations and income from its investments overseas as well as the national government’s net foreign currency deposits.
However, the BSP said that the increase in reserves was tempered by payments made by the government’s servicing of its foreign exchange obligations.
Foreign investments made by the central bank — which accounted for bulk of the reserves — hit $72.765 billion in July, up from $72.541 billion in June and $60.736 billion a year earlier.
Meanwhile, its holdings of foreign currency stood at $2.650 billion last month, down from $2.665 billion in June and $6.516 billion a year earlier.
A stronger peso usually means losses for the BSP, while a weaker peso boosts the GIR. The central bank taps its reserves to temper sharp swings in the exchange rate.
The BSP’s gold holdings stood at $8.016 billion, little changed from June but higher than the year-earlier level $7.788 billion.
Reserves maintained with the International Monetary Fund (IMF) rose to $566.6 million last month from $523.7 million in June.
Net international reserves, or the difference between the central bank’s GIR and short-term liabilities, also increased to $85.18 billion in July from $84.93 in June.
The end-July reserve level can cover 7.4 months’ worth of imports of goods and services payments. It was also equivalent to 5.2 times the country’s short-term external debt based on original maturity and 3.8 times based on residual maturity. — Mark T. Amoguis