MANILA - Market demand for the yuan will determine how much of the Chinese currency will be kept in the Bangko Sentral ng Pilipinas’ international reserves, Deputy Governor Diwa Guinigundo said Tuesday.
The central bank added the renminbi to its foreign currency reserves on Monday, as President Rodrigo Duterte sought to deepen ties with its Asian neighbor while distancing the country from its traditional ally, the United States.
The BSP will be “opportunistic” on its yuan holdings, Guinigundo told ANC’s “Market Edge with Cathy Yang.”
“If there is an opportunity, we will accumulate. If there’s no opportunity, we will not force that opportunity to come around,” he said.
“It is important that we do realize the increasing role of the Chinese economy as well as the renminbi. This is the major consideration of the Monetary Board in making the renminbi part of the reserve eligible currencies in our GIR (gross international reserves),” he said.
Guinigundo said China is the Philippines’ fourth largest trading partner and the biggest source of imports.
He said the BSP would watch for signs of increasing economic relations between the Philippines and China such as tourism receipts.
China lifted a travel warning to the Philippines last week after Duterte's visit to Beijing signaled a thaw in relations that have been strained by a bitter sea dispute.