Debt payments reduced the country's foreign currency reserves by the end of September to $95 billion from $97.4 billion as of end-August.

Preliminary Bangko Sentral ng Pilipinas data showed that the gross international reserves — a measure of a country's ability to settle import payments and service foreign debt — is on a downswing.

"The month-on-month decrease in the GIR level reflected mainly the national government's payments of its foreign currency debt obligations and downward adjustment in the value of the BSP's gold holdings due to the decrease in the price of gold in the international market," the central bank said.

Two-year low

Chief economist Michael Ricafort of Rizal Commercial Banking Corp said the GIR was at new two-year lows or since June 2020, largely attributed to the decline in foreign investments at $2.1 billion or 2.5 percent month-on-month.

GIR declined for the seventh straight month by $2.428 billion or negative 2.5 percent and also declined year-on-year by $11.6 billion or 10.9 percent, the economist added.

"Proceeds from the latest $2-billion global bond sale could augment the country's GIR and balance of payments," Ricafort said.

Chief economist Domini Velasquez of China Bank Corp., moreover, said that "the GIR came under pressure recently as it is one of the tools being used to support the peso. However, in 2020 and 2021, the BSP built up its international reserves for a 'rainy day,' such as this year."

"Currently, the GIR is still more than sufficient to cover our imports and external debt. Moreover, the draw down in reserves bt the BSP is aligned with what other central banks are experiencing globally, i.e. using policy rates and reserves to address challenges brought about by a stronger dollar," Velasquez added.