MANILA, Philippines ? (UPDATE) The country's gross international reserves edged slightly lower in September to $36.69 billion from $36.74 billion in August, the central bank said Tuesday.
The monetary authority said the decline was partly due to foreign debt payments by the government and the withdrawal of some currency deposits by state-run Power Sector Assets & Liabilities Management Corp's (PSALM).
PSALM, the agency overseeing the privatization of the government's power assets, has been repaying debts of the National Power Corp (Napocor) ahead of schedule to try to turn around the finances of the state-run power producer.
Part of the proceeds from the sale of power generation plants is deposited with the central bank, boosting the country's stock of foreign exchange.
The central bank has also been actively selling dollars in the currency market to slow the weakening of the peso.
The bank's holdings of foreign currencies through forward swaps fell to $3.56 billion in August, the lowest so far this year, as the monetary authority aggressively defended the peso.
The currency has lost 13 percent against the dollar so far this year, lately falling as part of a global sell-off in emerging market assets as investors cut risk to limit their exposure to the credit crisis.
The central bank's currency swaps serve as foreign exchange buffer for the monetary authority, as these represent additional foreign reserves the central bank would hold when the swap contracts are unwound.
The international reserves cover 5.8 months of imports of goods and payments of income and services. It is also equivalent to four times the country's short-term external debt based on original maturity and 2.6 times based on residual maturity.
The central bank said last month gross foreign reserves may reach $39 billion to $40 billion next year, up from an estimated $37 billion at the end of this year.