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By Maricel E. Burgonio, Reporter
THE country’s dollar reserves fell slightly
last month as the value of local gold holdings slipped in line with
recent weakness in the price of the precious metal, the Bangko
Sentral ng Pilipinas (BSP) said Friday.
In a statement, the BSP said the country’s
gross international reserves (GIR) dropped $200 million to $36.7
billion at end-August, compared with $36.9 billion the month before.
“The decrease in the GIR was due mainly to the
negative revaluation from the lower value of the BSP’s gold
holdings following the decline in the international price of
gold,” the central bank said.
The value of the BSP’s gold holdings
registered a loss of $332 million, thus declining to $3.568 billion
last month from $3.904 billion in July.
Even with the fall in gold prices, foreign
investments increased to $32.688 billion in August from $32.545
billion in July this year. Foreign investments include placements in
US treasury instruments.
At their current level, the Philippines’
dollar reserves can cover 6 months of imports of goods and payments
of services and income. The country’s dollar stock could also pay
five times over its short-term external debt based on original
maturity and 2.9 times the same obligations based on residual
maturity, which includes current portions of long-term debt.
Excluding the country’s short-term
liabilities, the level of net international reserves declined by
$400 million to $36 billion.
Despite the slight drop in the country’s
reserves, BSP Governor Amando Tetangco Jr. remained confident of
ending the year with a dollar cache of between $36.5 billion and $37
billion.
Earlier, the central bank said the country’s
GIR would climb to between $39 billion and $40 billion next year on
account of higher remittances from overseas Filipino workers. This
would enable the country to enjoy a $2.5 billion balance of payments
(BOP) surplus, or the same as the forecast for this year.
The BOP measures the country’s economic
transactions abroad, with a surplus indicating the country earned
more dollars than it gave up. Ample reserves meanwhile would prop up
the peso, thus tempering domestic price increases.
Latest official data showed that inflation last
month accelerated to a 17-year high of 12.5-percent due to high food
and fuel prices.
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