Philippine foreign reserves dwindle in November on debt payments, peso defense

MANILA, Philippines — The country’s foreign reserves declined in November after the government paid some of its maturing offshore debts while the Bangko Sentral ng Pilipinas continued to dip into the pile to prop up a cratering peso.

The Philippines’ gross international reserves (GIR) amounted to $93.95 billion by the end of November, lower compared to the $94.03 billion recorded in October, central bank data showed.

This marked the fifth straight month that the country's foreign reserves settled below $100 billion.

“The month-on-month decrease in the GIR level reflected mainly the National Government’s (NG) payments of its foreign currency debt obligations and the Bangko Sentral ng Pilipinas’ net foreign exchange operations,” the central bank said in a statement.

Foreign reserves are composed of the most-traded currencies such as Japanese yen, US dollar and the euro, as well as gold, investments of the BSP overseas, and contributions to the International Monetary Fund.

For 2022, the BSP forecasts the GIR to end the year at $99 billion, lower compared to last year’s pile of $108.8 billion as external headwinds and a widening trade gap stoke dollar outflows.

But despite the slump, November’s reserves, considered as buffer funds against external shocks, were still enough to cover 7.5 months’ worth of the country’s import requirements. — Ian Nicolas Cigaral