Forex reserves up slightly in May

MANILA, Philippines - The country’s gross international reserves went up slightly to $79.957 billion in May from a month ago, the Bangko Sentral ng Pilipinas reported yesterday.

“The increase in reserves was due mainly to the foreign exchange operations of the BSP and the net foreign currency deposits by the Treasurer of the Philippines, the central bank said.

“These inflows were partially offset by the revaluation adjustments on the BSP’s gold holdings and payments for maturing foreign exchange obligations of the national government,” the BSP said.

The GIR reflects a country’s ability to pay for its foreign debt and imports of goods and services.

The forex reserves for May were enough to pay for 11.1 months’ worth of imports of goods and payments of services and income.

The figure was well above the traditional rule of thumb that puts the adequate level of reserves to an equivalent of three months worth of imports.

The BSP also said it is equivalent to 6.8 times the country’s short-term external debt based on original maturity and 4.8 times based on residual maturity.

Meanwhile, net international reserves or GIR minus short-term debts went up to $79.941 billion in May from $79.828 billion in April.

The central bank expects GIR to rise by six percent to $88 billion this year from $83.187 billion in 2013.