The country’s gross international reserves (GIR) reached a new record-high level of US$21.147 billion as of end-June 2006, higher by US$197 million from the end-May 2006 level of US$20.950 billion. The preliminary June GIR level is adequate to cover about 4.3 months of imports of goods and payments of services and income. This level is also equivalent to 3.4 times the country’s short-term debt based on original maturity and 1.8 times based on residual maturity. 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.
The increase in the GIR level was attributed to the Bangko Sentral’s foreign exchange operations, income from investments abroad, the National Government’s (NG) deposit of the proceeds from its project loans, and the release of collateral arising from the pretermination of some Brady Bonds in May. These inflows, however, were partly offset by payments for maturing foreign exchange obligations of the BSP and the NG.
Net international reserves (NIR), including revaluation of reserve assets and reserve-related liabilities, increased to US$20.517 billion, up by US$218 million from the end-May 2006 level of US$20.299 billion. NIR refers to the difference between the BSP’s GIR and the combined total of short-term liabilities and use of Fund credits.