Dollar reserves slide to $97.4 billion in October

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November 9, 2026 | 12:00am

As peso weakens, gold prices drop

MANILA, Philippines — The country’s dollar reserves fell further to $97.4 billion in October, weighed down by foreign exchange operations, declining gold prices and government withdrawals amid continued pressure on the peso.

Preliminary data from the Bangko Sentral ng Pilipinas (BSP) showed gross international reserves (GIR) declined by 2.2 percent from $99.49 billion in September. The latest level was also 11.7 percent lower than the $110.25 billion recorded in October last year.

GIR refers to the central bank’s holdings of foreign assets, including gold, securities and foreign currency deposits, which help finance imports, settle foreign debt and cushion the economy against external shocks.

The BSP attributed the decline to its net foreign exchange operations, downward valuation adjustments primarily involving gold and the national government’s foreign currency withdrawals for debt payments and other funding requirements.

Foreign exchange operations may include buying or selling dollars to smooth sharp fluctuations in the peso. The local currency came under pressure in October, reaching an intraday record low of 64.2 against the dollar on Oct. 27.

UnionBank chief economist Ruben Carlo Asuncion said the reserve decline warrants monitoring, although the country continues to maintain sufficient external buffers.

“The year-on-year decline in reserves is significant and bears watching, but at $97.4 billion, we are not yet looking at a reserve-adequacy problem,” Asuncion said.

“More important than the absolute level is the pace and persistence of the drawdown, particularly if accompanied by sustained peso pressure,” he added.

By component, gold reserves declined by 4.9 percent to $16.95 billion in October from a month ago, while foreign currency securities fell by 1.7 percent to $62.84 billion.

Other reserve assets slipped by 7.5 percent to $9.24 billion, partly offset by higher currency and deposits, which rose to $3.65 billion.

Despite the decline, the BSP said reserves remained an “adequate external liquidity buffer,” equivalent to 6.1 months of imports and payments for services and primary income.

Reserves could also cover 3.1 times the country’s short-term external debt, including loan principal payments falling due within a year.

Asuncion warned that persistent peso weakness could trigger further reserve drawdowns.

“For now, the external buffer remains adequate, but continued reserve losses could gradually reduce the BSP’s room to manage external shocks and excessive forex volatility,” he said.