Forex reserves hit 8-month high in August

Posted at 09/05/2014 4:53 PM | Updated as of 09/05/2014 4:54 PM

MANILA, Philippines - Gross international reserves reached an 8-month high in August, driven by earnings from the Bangko Sentral ng Pilipinas' foreign exchange operations and investments abroad.

Data from the BSP showed GIR was at $80.785 billion in August, up from $80.644 billion in July. This was the highest since December 2013.

"The increase in reserves was due mainly to the foreign exchange operations of the BSP, net foreign currency deposits by the Treasurer of the Philippines, and income from the BSP’s investments abroad," the BSP said.

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

August's forex reserves can cover 11 months worth of imports, and are equal to 5.7 times short-term foreign debt and residual maturity basis.

The central bank has lowered its estimate for 2014 foreign reserves to $85.3 billion from $88 billion. Foreign reserves reached $83.2 billion at end-2013.

The central bank expects cash remittances from Filipinos overseas to rise 5 percent this year after a 6.4 percent growth in 2013 when they hit a record $22.97 billion.

In July, the central bank raised the benchmark overnight borrowing rate by 25 basis points to 3.75 percent, the first in three years, to stay on top of inflation pressures as the economy continued to gather speed. - With Reuters