Dollar reserves fall to $107.5 billion in March

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April 9, 2026 | 12:00am

MANILA, Philippines —  The country’s foreign exchange buffer declined to $107.51 billion as of end-March, reversing earlier gains as global market volatility weighed on key reserve components, preliminary data from the Bangko Sentral ng Pilipinas (BSP) showed.

Month on month, gross international reserves (GIR) dropped by 5.1 percent from $113.26 billion as of end-February, marking the lowest level in seven months or since the $107.1 billion seen in August 2025.

Despite the decline, reserves were still slightly higher by 0.8 percent from $106.67 billion in the same period a year ago, indicating a relatively stable external position over the past year.

The BSP said the latest GIR level “provides a robust external liquidity buffer,” equivalent to 7.1 months’ worth of imports of goods and payments of services and primary income, still well above the three-month international benchmark.

It also covers about 3.9 times the country’s short-term external debt based on residual maturity, reflecting the economy’s ability to meet near-term foreign obligations.

Based on central bank data, the March decline was largely driven by lower foreign investments and gold holdings, which offset gains in other reserve assets.

Data showed foreign investments, which account for the bulk of reserves, slipped by 3.9 percent to $80.9 billion in March from $84.2 billion in February. On an annual basis, these assets were also lower by about nine percent from $88.92 billion.

RCBC chief economist Michael Ricafort said the monthly decline largely reflected “lower foreign investments due to market volatility that reflected the adverse effects of the war” in the Middle East since February.

Gold holdings also declined significantly, falling to $20.18 billion from $23.06 billion in the previous month. This reflected lower global gold prices during the period, which reduced the valuation of the central bank’s gold assets.

Ricafort noted that gold holdings fell by 12.5 percent after global gold prices declined by 11.6 percent in March.

Despite the drop, gold reserves remained higher year on year by 58 percent from $12.76 billion in March 2025, providing support to GIR in previous months.

Meanwhile, other components provided some offsetting support. The country’s foreign exchange holdings rose to about $1.76 billion from $1.31 billion, while the reserve position in the International Monetary Fund (IMF) stood at $714.3 million. Special drawing rights were steady at $3.96 billion.

GIR consists of foreign-denominated securities, foreign exchange, gold and other reserve assets, including the IMF reserve position and special drawing rights. These reserves serve as a buffer against external shocks, enabling the country to pay for imports, service foreign debt and stabilize the peso.

Looking ahead, Ricafort said GIR movements would continue to depend on global market conditions, particularly gold prices and geopolitical developments.

“For the coming months, GIR will continue to be a function of world gold prices… as well as any improvement in global and local market conditions should there be a continued ceasefire or de-escalation of the war on the Middle East,” he said.

The BSP expects the country’s GIR to reach $110 billion this year and $112 billion in 2027.