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The Philippines’ foreign currency reserves remained healthy at USD105.7 billion in July, according to the latest data from the central bank, despite a marginal decline from the previous month.
The Bangko Sentral ng Pilipinas (BSP) reported on Thursday that the gross international reserves (GIR) were slightly lower than June’s USD106 billion but remain at levels that continue to support the country’s external position.
These reserves serve as the country’s financial safety net, allowing the government to manage external shocks, stabilize the peso, and ensure the smooth payment of imports and foreign debt obligations. The central bank emphasized that the July GIR figure is equivalent to 7.2 months’ worth of imports and 3.4 times the country’s short-term external debt, well above internationally accepted adequacy standards.
The GIR consists of foreign assets held by the BSP in foreign currencies, including gold reserves, foreign investments, and special drawing rights. A reserve level is considered adequate if it can finance at least three months' worth of imports, making the Philippines' current buffer more than double the minimum threshold.
While the dip reflects normal fluctuations in global asset valuations and foreign exchange operations, analysts note that the GIR remains strong enough to maintain investor confidence and support macroeconomic stability.
The central bank reaffirmed its commitment to prudent reserve management, citing the importance of maintaining ample liquidity buffers as the country continues to navigate global economic uncertainties.
The strength of the foreign reserves adds to the government’s arsenal in mitigating external risks, especially amid ongoing geopolitical tensions, fluctuating commodity prices, and the possibility of tighter global financial conditions.
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