The country’s gross international reserves (GIR) slightly dipped to $83.4 billion as of end-October 2013, the Bangko Sentral ng Pilipinas (BSP) said on Thursday.
Preliminary data from the BSP showed that the country’s reserves for the first 10 months of the year was lower by $100 million compared to the end-September reserves of $83.5 billion.
“At this level, reserves can adequately cover 12 months’ worth of imports of goods and payments of services and income,” BSP officer-in-charge Vicente Aquino said.
The GIR is also equivalent to 8.6 times the country’s short-term external debt based on original maturity, and 5.7 times based on residual maturity, he added.
Year-on-year, the GIR for October was higher compared to the $81.74 billion recorded in 2012.
Meanwhile, the central bank said that the decline in reserves in October this year can be attributed to the national government’s (NG) payments for its maturing foreign exchange obligations, and revaluation adjustments on the BSP’s gold holdings.
The monetary authority said that outflows were partially offset by foreign currency deposits by the treasurer of the Philippines, and foreign exchange purchases and income from investments of the BSP.
The GIR are foreign assets that are readily available to and controlled by the central bank for direct financing of payments imbalances, and for managing the magnitude of such imbalances.
The reserves consist of holdings of gold, special drawing rights, foreign investments and foreign exchange, including reserve position in the fund. These assets are valued mark-to-market. Higher reserves help prop up the peso and keeps domestic inflation at bay.
On the other hand, the data showed that net international reserves (NIR), also decreased by $100 million to reach $83.4 billion as of end-October 2013, compared to the end-September 2013 NIR of $83.5 billion.
NIR refers to the difference between the BSP’s GIR and total short-term liabilities.