Latest news with #BangkoSentralngPilipinas'
GMA Network
4 days ago
- Business
- GMA Network
Rise in gold value drove up PH reserves to $105.5B in May 2025
'The month-on-month increase in the GIR level reflected mainly the upward valuation adjustments in the Bangko Sentral ng Pilipinas' gold holdings due to the increase in the price of gold in the international market, net income from the BSP's investments abroad, and national government's net foreign currency deposits with the BSP,' the central bank said. The country's foreign reserves snapped two straight months of decline in May as the increase in global gold prices drove up the value of the central bank's gold assets, offsetting the effect of tempered foreign investments amid uncertainty brought by US President Donald Trump's reciprocal tariff policy. Preliminary data released by the Bangko Sentral ng Pilipinas (BSP) showed the gross international reserves (GIR) —a measure of the country's ability to settle import payments and service foreign debt— amounted to $105.5 billion as of end-May from $105.3 billion as of end-April. 'The month-on-month increase in the GIR level reflected mainly the upward valuation adjustments in the Bangko Sentral ng Pilipinas' gold holdings due to the increase in the price of gold in the international market, net income from the BSP's investments abroad, and national government's net foreign currency deposits with the BSP,' the central bank said. The Philippine central bank's reserve assets include foreign investments, gold, foreign exchange, IMF reserve positions, and special drawing rights. Rizal Commercial Banking Corp. chief economist Michael Ricafort said the GIR increase during the period was 'due to the continued gains in gold holdings to all-time highs after world gold prices hovered near record highs recently ($3,500.10 per ounce on April 22, 2025),' which offset the decline in foreign investments 'amid the continued Trump risk factor/premium that led to some market volatility worldwide.' Net inflows of foreign direct investments (FDI) to the Philippines dropped to a 10-month low in February 2025 to $529 million, down 61.9% from $1.062 billion net inflows seen in February 2024, amid high base effects and global uncertainties weighing on foreign investors' sentiments. Ricafort said that value of the BSP's gold assets rose by 2.9% to $13.7 billion month-on-month 'largely reflecting and consistent with the elevated world gold prices, which again posted new record highs recently partly due to some flight to safe havens such as gold amid the recent global market volatility largely brought about uncertainties on Trump's higher US import tariffs.' Trump, in April, announced a sweeping reciprocal tariff policy on its trading partners, including the Philippines, which would be facing a 17% tariff on its imports to the US. Although it is lowest among its Southeast Asian peers, still the Philippine government was prompted to send a delegation to Washington to seek dialogue with US officials while a 90-day pause in implementing the trade policy was ongoing. 'The GIR is still above the $100-billion mark for the 20th straight month or since October 2023 —still a good signal, on the country's strong external position that could help stabilize the peso exchange rate and support the country's favorable credit ratings of 1-3 notches above the minimum investment grade in recent years despite the COVID-19 pandemic,' Ricafort said. The BSP said the latest GIR level provides a 'robust' external liquidity buffer, equivalent to 7.3 months' worth of imports of goods and payments of services and primary income or earnings of overseas Filipino workers and profits from Philippine investments abroad. By convention, GIR is viewed to be adequate if it can finance at least three months' worth of the country's imports of goods and payments of services and primary income. The end-May reserves would also cover about 3.7 times the country's short-term external debt 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 level of GIR, as of a particular period, is considered adequate if it provides at least 100% cover for the payment of the country's foreign liabilities, public and private, falling due within the immediate 12-month period. Similarly, the net international reserves —the difference between GIR and the BSP's reserve liabilities (short-term foreign debt and credit and loans from the IMF)— grew by about $8 million from $105.26 billion as of end-April to $105.34 billion as of end-May. –NB, GMA Integrated News
Bloomberg
31-01-2025
- Business
- Bloomberg
Philippine Central Bank Chief Eyes Rate Cut After Tepid Growth
The Philippine central bank is considering to cut borrowing cost further at next month's meeting, Governor Eli Remolona said a day after the government reported that economic growth missed the target for a second straight year. 'It's on the table,' Remolona told reporters on Friday, when asked about a possible reduction in the Bangko Sentral ng Pilipinas' benchmark target rate at the Feb. 13 meeting, from the current 5.75%.
