GIR hits new record of $43.7 billion as of November

MANILA, Philippines - The country’s gross international reserves (GIR) hit a new record high of $43.73 billion in November on the back of higher borrowings by the government as well as the increasing value of the central bank’s gold holdings.

Bangko Sentral ng Pilipinas (BSP) Governor Amando M. Tetangco Jr. reported yesterday that the country’s GIR went up by $500 million from the end-October level of $43.2 billion.

The GIR last month was also $6.9 billion higher than the level of $36.83 billion booked in November last year.

“The continued build-up in the GIR level was due mainly to revaluation gains on the BSP’s gold holdings on account of the sustained rise in the price of gold in the international market, foreign currency deposit by the government of its loan proceeds, as well as income from BSP’s investments abroad,” Tetangco said.

The government tapped the international capital market for the third time last month for much needed funds, successfully raising $1 billion. This brought the country’s total foreign commercial borrowings to $3.25 billion this year.

Data showed that the central bank’s foreign investments went up by $201 million to $36.37 billion in November from $36.19 billion in October while its gold holdings rose by $358 million to $5.633 billion in November from $5.27 billion a year ago.

On the other hand, the general allocation of Special Drawing Rights (SDRs) which was made available by the International Monetary Fund (IMF) to its members including the Philippines was unchanged at $1.153 billion as of end November.

Tetangco said the increase in GIR was partially offset by outflows arising from the payment of maturing foreign exchange obligations by the government and the BSP.

He added that outflows also included foreign currency withdrawals by authorized agent banks.

The GIR is the sum of all foreign exchange flowing into the country and the balance of payment position is the remaining balance net of all external payments for debt servicing and imports.

The BSP chief said the current GIR level could cover 8.1 months of imports of goods and payments of services and income.

He added that the reserves were also equivalent to 9.2 times the country’s short-term external debt based on original maturity and four times based on residual maturity falling due in the next 12 months.

The BSP expects the GIR to range between $43 billion and $44 billion instead of $37.5 billion and $38.5 billion this year.