Due to lower global gold prices and a weaker peso, the Philippines’ dollar reserves slid to a fresh over two-year low of $80.313 billion in November, preliminary Bangko Sentral ng Pilipinas data released Thursday showed.
The gross international reserves (GIR) level last month remained the lowest since November 2015’s $80.173 billion.
In a statement, BSP Deputy Governor Chuchi G. Fonacier attributed the further decline in the GIR from $80.419 billion in October mostly to “outflows arising from payments made by the national government for its maturing foreign exchange obligations as well as revaluation adjustments on the gold holdings of the BSP resulting from the decrease in the price of gold in the international market.”
The peso remained at the 51:$1 level in November.
The drop in GIR was nonetheless “partially offset by the net foreign currency deposits of the national government and income from the BSP’s investments abroad,” Fonacier said.
The end-November GIR can cover 8.4 months’ worth of imports of goods as well as payments of primary income and services.
Also, the dollar reserves level as of November were equivalent to 5.4 times the short-term external debt based on original maturity, as well as 3.7 times based on residual maturity.
The BSP defines short-term debt based on residual maturity as outstanding foreign debt whose original maturity was a year or less, plus principal payments on medium- and long-term loans of the government as well as the private sector that are due within the next 12 months.
As for net international reserves, or the difference between the GIR and total short-term liabilities, these also declined to $80.3 billion in November from October’s $80.4 billion.
The BSP had projected dollar reserves to slightly decrease to $80.5 billion by end-2017, equivalent to 8.3 months of import cover, from end-2016’s $80.7 billion.