GROSS international reserves (GIR) in the country climbed further in April for the fifth straight month on higher inflows from the central bank’s foreign exchange operations, the Bangko Sentral ng Pilipinas (BSP) reported on Tuesday.

Dollar reserves increased to $83.956 billion in April from the upward-revised $83.613 billion in March, the central bank said. Last month’s total was also higher than the $79.608 billion logged in April 2018.

April’s total is likewise the highest reserve level since October 2016, when the country’s GIR stood at $85.11 billion.

In a statement, the BSP attributed the rise in dollar reserves to its foreign exchange operations and income from its investments overseas, as well as inflows from the national government’s (NG) net foreign currency deposits.

“However, the increase in reserves was tempered partially by payments made by the NG for servicing its foreign exchange obligations as well as revaluation losses from the BSP’s gold holdings, resulting from the decrease in the price of gold in the international market,” the central bank said.

Income from the BSP’s offshore investments increased to $71.936 billion in April from $71.409 billion the previous month and the $64.519 billion posted in April 2018. This accounted for bulk of the reserves.

Meanwhile, the country’s foreign currency stash dropped to $2.189 billion last month from $2.283 billion in March and $5.197 billion in April last year. A stronger peso usually means losses for the BSP while a weaker peso pads the GIR.

The central bank uses the reserve money to temper sharp swings in the exchange rate. The peso strengthened slightly in April from the previous month, with the average logging at P52.112 versus the dollar against March’s P52.413.

The BSP’s gold holdings also decreased to $8.124 billion in April from $8.214 billion in March and $8.251 billion in the same month last year, reflecting lower gold valuations in the international market.

Reserves maintained under the International Monetary Fund (IMF) were mostly steady at $524.3 million versus $524.6 million the prior month. Special drawing rights — or the amount which the Philippines can tap under the IMF’s reserve currency basket — were also steady at $1.183 billion.

The end-April GIR settled above the BSP’s $77-billion projection for the year and the end-2018 level of $79.193 billion.

The current level, which the BSP said “serves as an ample external liquidity buffer,” can cover up to 7.4 months’ worth of import duties and is equivalent to five times the country’s short-term external debt based on original maturity and 3.5 times based on residual maturity.

The GIR has consistently been cited as a source of strength for the Philippines as it serves as a buffer against external shocks. — RJNI