The country’s foreign exchange buffer proved nearly steady at $107.98 billion in February from the revised $107.69 billion in January, according to Bangko Sentral ng Pilipinas (BSP).
Central bank Governor Benjamin Diokno said the month-on-month increase in the gross international reserves (GIR) level reflected mainly the upward adjustment in the value of the central bank’s gold holdings due to the increase in the price of gold in the international market.
Diokno added the buffer was boosted by the BSP’s net income from its investments abroad.
Data show the buffer represents a more than adequate external liquidity buffer equivalent to 10.2 months worth of imports of goods and payment of services and primary income, more than the minimum international threshold of three to four months.
Likewise, the GIR level is about 8.4 times the country’s short-term external debt based on original maturity and 5.8 times based on residual maturity,
The buffer is the sum of all foreign exchange flowing into the country, ensuring the country will not run out of foreign exchange that it could use in case of external shocks.
The BSP lowered the GIR target to a record high of $112 billion instead of $115 billion for this year.