The country’s gross international reserves (GIR) climbed to a new record high of US$41.3 billion as of end-August 2009, up by US$1.1 billion from the end-July 2009 level of US$40.2 billion, Bangko Sentral ng Pilipinas Governor Amando M. Tetangco, Jr. announced today.
The large increase in the preliminary end-August 2009 GIR level was due mainly to the general allocation of Special Drawing Rights (SDR) which was made available by the International Monetary Fund (IMF) to its members, including the Philippines, to boost their reserves and provide liquidity to the global economic system. 1 Other factors contributing to the increase in the reserves level were inflows from the BSP’s net foreign exchange operations and income from investments abroad. These receipts were partly offset by outflows arising from the repayment of maturing foreign exchange obligations of the National Government (NG) and valuation losses in the BSP’s gold holdings on account of the lower price of gold in the international market in August 2009.
The current GIR level could cover 7.1 months of imports of goods and payments of services and income. It was also equivalent to 6.6 times the country’s short-term external debt based on original maturity and 3.3 times based on residual maturity. 2
The level of net international reserves (NIR), which includes revaluation of reserve assets and reserve-related liabilities, likewise increased by US$1.1 billion to US$40.5 billion as of end-August 2009 from the previous month’s level of US$39.3 billion. NIR refers to the difference between the BSP’s GIR and total short-term liabilities.
1 The Special Drawing Rights (SDR) is an international reserve asset created by the IMF in 1969 to supplement the existing official reserves of member countries. SDRs are allocated to member countries in proportion to their IMF quotas. The latest SDR allocation is part of the US$283 billion in SDRs injected by the IMF into the global economy to support growth in emerging market and developing countries.
2 Short-term debt based on residual maturity refers to outstanding external debt with original maturity of one year or less, plus principal payments on medium- and long-term loans of the public and private sectors falling due within the next 12 months.