New high: PH foreign reserves rise to $85.8-B in January
MANILA, Philippines (UPDATED) – The Philippines' foreign exchange or gross international reserves (GIR) hit a new high and inched up 2% to $85.8 billion at end-January from the end-December level of $83.8 billion, the Bangko Sentral ng Pilipinas (BSP) reported Thursday, February 7.
In a statement, the BSP said the growth was driven by its foreign exchange income and income from investments abroad, as well as foreign currency deposits by the government.
GIR is an indicator of the country's ability to pay for imports and debts in foreign currencies.
January's preliminary GIR level is just under the reported full-year 2013 target of $86 billion.
It can cover 12.3 months worth of imports of goods and was equivalent to 10.7 times the country's short-term external debt based on original maturity,
In the statement, BSP Governor Amando Tetangco Jr. attributed the GIR's “appreciable increase” to interest from the central bank’s foreign investments and “inflows” from its foreign exchange operations.
In particular, BSP's foreign exchange operations -- mainly the purchase of dollars in the market to manage the peso’s rise against the dollar -- contributed $997.71 million as of January.
This reflected the highest increase (7.58%) from December 2012 level.
The central bank has been intervening in the foreign exchange market to temper the peso’s appreciation. Beneficiaries of remittances from overseas Filipinos and the dollar earners (exporters and business process outsourcing firms) have complained that a strong peso hurt them.
Loans to IMF
The Philippines, which transformed into a lender to the International Monetary Fund (IMF) after decades of being a borrower, also granted more loans to the multilateral lender.
IMF has tapped $539 million in total loans, higher by almost 1%.
The IMF has yet to draw on some $1.3 billion facility called the special drawing rights (SDR), which the Philippines has funded.
Government's payment of foreign obligations, as well as the Power Sector Assets and Liabilities Management Corp. (PSALM) withdrawals and the decrease in gold prices offset the dollar inflows, Tetangco explained.
The value of BSP’s gold holdings was down to $10.302 billion by end-January from $10.353 billion as of end-2012. – Rappler.com