The financial determinants of gross international reserves: Evidence from the Philippines (2007-2014)

• Main Authors: Fong, Janessa Reeanne F., Montellano, Ezekiel Angelo S., Pilario, Lea Katrina S., Quiao, Roselle D.
• Format: text
• Language: English
• Published: Animo Repository 2016
• Subjects: Foreign exchange reserves > Philippines; Money supply > Philippines
• Online Access: https://animorepository.dlsu.edu.ph/etd_bachelors/7765
• Institution: De La Salle University

One of the significant factors of a country's sustainability is the gross international reserves (GIR). It can be used as a buffer in case of fluctuations in a country's currency and for purchasing of foreign goods. Recently, it was discovered that the changes of money supply and the behavior of net capital flows affect and/or determines the movement of a country's GIR. The objectives of this study are to measure the level of significance of the said variables affecting a country's GIR and to propose two more variables namely interest rate and exchange rate (REER). The results showed that money supply is the variable with the most significance when run with all four variables. Although the suggested variables turned out to be insignificant due to the number observations used, the proponents still believe that these variables can be used as determinants of GIR. In order to do this, further studies may be conducted to improve the results.