DOLLAR RESERVES HIT 7-MONTH HIGH IN MAY

The country’s dollar reserves climbed to a seven-month high of $82.066 billion in May due mainly to higher gold prices and strong inflows from the Bangko Sentral ng Pilipinas’ investments overseas.

The gross international reserves (GIR) level last month was the highest since the $85.106 billion recorded in October last year but lower than the $82.927 billion registered in May last year, preliminary data from the BSP showed.

In a statement, BSP Governor Amando M. Tetangco Jr. attributed the month-on-month reserves buildup to “inflows arising from the net foreign currency deposits of the national government, income from the BSP’s investments abroad and revaluation adjustments on the BSP’s gold holdings resulting in the increase in gold prices in the international market.”

“However, these were partially offset by the BSP’s foreign exchange operations and payments made by the government for its maturing foreign exchange obligations,” Tetangco added. The peso remained at the 49:$1 level last month.

The end-May GIR can cover 9.1 months’ worth of imports of goods and payments of primary income and services.

The May dollar reserves were equivalent to 5.3 times the short-term external debt based on original maturity, as well as 3.7 times based on residual maturity.

The BSP defines short-term debt based on residual maturity as outstanding foreign debt whose original maturity was a year or less, plus principal payments on medium- and longterm loans of the government as well as the private sector that were due within the next 12 months.

Net international reserves—or the difference between the GIR and total shortterm liabilities—also inched up to $82.05 billion in May from $82 billion in April.

For 2017, the BSP had projected dollar reserves to rise to $84.7 billion, or 8.8 months of import cover.