PH international reserves neared two-year low of $103.4B in July

MANILA, Philippines — The Philippines’ foreign reserves fell to their lowest level in nearly two years in July, as the government paid down offshore debt and the central bank intervened to limit swings in peso trading.

Gross international reserves totaled $103.4 billion at the end of July, down 1.2 percent from $104.7 billion a month earlier, the Bangko Sentral ng Pilipinas (BSP) said on Friday. It was the lowest level since January 2025, when reserves stood at $103.3 billion.

READ: Gross international reserves hit 3-month high

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The decline also pushed the reserve buffer below the central bank’s revised year-end forecast of $104 billion.

Foreign reserves provide a cushion against external shocks, helping the country pay for imports and service foreign debt when export earnings weaken or access to overseas financing becomes more difficult. Most of the reserves are held in foreign investments, along with gold, foreign-exchange holdings and reserve assets at the International Monetary Fund.

The latest figures showed that the central bank’s holdings of foreign debt securities, which make up the bulk of its reserves, had fallen 6.5 percent from the previous month to $67.3 billion. But other reserve assets—which include overnight investments under the Asia Bond Fund and Bank of International Settlements Investment Pool—rose 34 percent to $12.1 billion.

The BSP’s foreign-exchange holdings, which include time and demand deposits as well as cash, also declined to $1.8 billion, the lowest in two months. Part of the decline reflected the national government’s withdrawal of dollars from its deposits with the BSP to meet external debt obligations, the central bank said.

The BSP has also been drawing on its reserves to manage heightened volatility in the peso-dollar spot market. INQ