By Katherine K. Chan, Reporter
THE PHILIPPINES’ dollar reserves fell to a seven-month low at end-March as its gold holdings and foreign investments declined, preliminary Bangko Sentral ng Pilipinas (BSP) data showed.
As of end-March, the country’s gross international reserves (GIR) stood at $107.512 billion, declining by 5.08% from the record-high $113.264 billion posted a month ago.
This was the lowest GIR level in seven months or since the $107.098 billion seen in August last year.
However, this was 0.79% higher than the $106.67 billion recorded at end-March 2025.
Still, the BSP said the end-March GIR level “provides a robust external liquidity buffer” as it equates to 7.1 months’ worth of imports of goods and payments of services and primary income, exceeding the three-month standard.
It could also cover about 4.1 times the country’s short-term external debt based on residual maturity, according to the BSP.
“The latest GIR level ensures availability of foreign exchange to meet balance of payments financing needs, such as for payment of imports and debt service, in extreme conditions when there are no export earnings or foreign loans,” the BSP said in a statement late on Tuesday.
Dollar reserves are the central bank’s foreign assets held mostly as investments in foreign-issued securities, foreign exchange and monetary gold, among others.
These are supplemented by claims to the International Monetary Fund (IMF) in the form of reserve position in the fund and special drawing rights (SDRs).
The country’s foreign reserves fell month on month in March as market volatility amid the Middle East war dampened foreign investments and as lower gold prices decreased the value of the gold holdings, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said.
“The monthly decline (was) largely due to lower foreign investments due to market volatility that reflected the adverse effects of the war on Iran (and) Middle East since Feb. 28, 2026 and also lower world gold prices that reflected the decline in gold holdings,” he said in a Viber message.
Based on BSP data, its gold holdings amounted to $20.177 billion at end-March, falling by 12.49% from the $23.057 billion at end-February as world gold prices edged down by 11.6% last month. Year on year, it jumped by 58.09% from $12.763 billion.
Its foreign investments also slipped by 3.92% to $80.9 billion from $84.205 billion in the previous month and by 9.02% from $88.924 in the same period last year.
Meanwhile, the Philippines’ reserve position in the IMF slid to $714.3 million as of end-March, 1.67% lower than the $726.4 million logged in the prior month. However, it edged up by 9.39% from $653 million a year earlier.
SDRs — or the amount the Philippines can tap from the IMF’s reserve currency basket — were unchanged month on month at $3.964 billion. It climbed by 4.18% annually from $3.805 billion a year ago.
Central bank data also showed that the country’s foreign exchange holdings reached $1.757 billion during the period, up by 33.93% from $1.312 billion at end-February. It more than tripled (234.64%) from $525.1 million as of end-March 2025.
In the coming months, GIR could rise as global gold prices climb and market conditions recover, especially if the Middle East war continues to de-escalate, Mr. Ricafort said.
He added that the peso’s recent rebound from record lows last month could also support the GIR as it “could reduce the need for intervention in the local foreign exchange market.”
In March, the local unit touched the P60-a-dollar level for the first time. It closed at a new all-time low of P60.748 against the greenback on March 31.
The BSP has said that it remains present in the foreign exchange market to prevent sharp movements that could be inflationary.
It uses the country’s foreign reserves by releasing US dollar liquidity when intervening in the foreign exchange market amid episodes of peso depreciation.
The BSP expects foreign reserves to settle at $111 billion by end-2026.
