The key points are temporarily unavailable. You can still read the full Story below.
Main Points
The Philippine peso closed at 64.17 pesos per U.S. dollar on Monday, marking its sixth consecutive record low and the first time the currency has closed above the 64‑level in its history. The rate fell 22 centavos from the 63.95 close on Sunday. The peso opened at 63.95, briefly strengthened to 63.90, but later reached an intraday high of 64.20 before settling at the 64.17 level. The currency has depreciated roughly 10 percent since the close of 57.66 on February 28, the day the Middle East conflict began. The decline has continued despite the Bangko Sentral ng Pilipinas’ (BSP) “jumbo” 50‑basis‑point policy rate hike last Thursday. BSP Governor Eli Remolona Jr. said the rate increase was aimed at curbing inflation, which stands at a three‑year high of 7.2 percent, and not at defending the peso. “We’re not hiking the policy rate to defend the peso,” he told reporters. “We do intervene a little bit in the foreign exchange market, but that’s mainly to avoid swings in the exchange rate that tend to be inflationary. We have estimates of how much the peso has to move before it becomes inflationary, and that’s when we tend to intervene.” Remolona declined to disclose the specific threshold that would trigger intervention, citing concerns that it could fuel market speculation. He added that the BSP does not rely solely on foreign reserves to counter the currency’s slump. Economists warn that the peso’s continued slide could prompt further monetary tightening. Bank of the Philippine Islands lead economist Emilio Neri Jr. said the BSP might consider an off‑cycle rate hike if the depreciation accelerates. “The magnitude of the change – if it’s too rapid, they might consider it,” Neri told reporters Monday evening. He also noted that the peso’s decline raises concerns about the country’s foreign‑reserve buffer, which has fallen by about $13 billion to a three‑year low of $99.5 billion, down from the record $113.264 billion reported in February before the conflict began. The weakening peso makes imported goods—including fuel, food and raw materials—more expensive, contributing to higher inflation and increased household costs. Businesses face higher production and transportation expenses, which could lead to price hikes or reduced profits. Exporters and families receiving remittances benefit from stronger dollar earnings. Rising import costs can widen the trade deficit, while higher debt‑servicing costs strain the government and firms with dollar‑denominated loans, potentially slowing economic growth. The Philippine economy contracted to a 17‑year low in the second quarter of this year. The peso’s depreciation has been driven in part by global market conditions. Brent crude oil peaked at $117 per barrel over the weekend, and U.S. President Donald Trump raised the prospect of renewed military action against Iran, strengthening safe‑haven demand for the dollar. The combination of oil‑price volatility and escalating tensions involving Iran has added pressure on the Philippine currency. Article source: The Daily Tribune | Image credit: The Daily Tribune
The Philippine peso closed at 64.17 pesos per U.S. dollar on Monday, marking its sixth consecutive record low and the first time the currency has closed above the 64‑level in its history. The rate fell 22 centavos from the 63.95 close on Sunday. The peso opened at 63.95, briefly strengthened to 63.90, but later reached an intraday high of 64.20 before settling at the 64.17 level. The currency has depreciated roughly 10 percent since the close of 57.66 on February 28, the day the Middle East conflict began. The decline has continued despite the Bangko Sentral ng Pilipinas’ (BSP) “jumbo” 50‑basis‑point policy rate hike last Thursday. BSP Governor Eli Remolona Jr. said the rate increase was aimed at curbing inflation, which stands at a three‑year high of 7.2 percent, and not at defending the peso. “We’re not hiking the policy rate to defend the peso,” he told reporters. “We do intervene a little bit in the foreign exchange market, but that’s mainly to avoid swings in the exchange rate that tend to be inflationary. We have estimates of how much the peso has to move before it becomes inflationary, and that’s when we tend to intervene.” Remolona declined to disclose the specific threshold that would trigger intervention, citing concerns that it could fuel market speculation. He added that the BSP does not rely solely on foreign reserves to counter the currency’s slump. Economists warn that the peso’s continued slide could prompt further monetary tightening. Bank of the Philippine Islands lead economist Emilio Neri Jr. said the BSP might consider an off‑cycle rate hike if the depreciation accelerates. “The magnitude of the change – if it’s too rapid, they might consider it,” Neri told reporters Monday evening. He also noted that the peso’s decline raises concerns about the country’s foreign‑reserve buffer, which has fallen by about $13 billion to a three‑year low of $99.5 billion, down from the record $113.264 billion reported in February before the conflict began. The weakening peso makes imported goods—including fuel, food and raw materials—more expensive, contributing to higher inflation and increased household costs. Businesses face higher production and transportation expenses, which could lead to price hikes or reduced profits. Exporters and families receiving remittances benefit from stronger dollar earnings. Rising import costs can widen the trade deficit, while higher debt‑servicing costs strain the government and firms with dollar‑denominated loans, potentially slowing economic growth. The Philippine economy contracted to a 17‑year low in the second quarter of this year. The peso’s depreciation has been driven in part by global market conditions. Brent crude oil peaked at $117 per barrel over the weekend, and U.S. President Donald Trump raised the prospect of renewed military action against Iran, strengthening safe‑haven demand for the dollar. The combination of oil‑price volatility and escalating tensions involving Iran has added pressure on the Philippine currency.
News Desk is the editorial publishing account for Tringlobe Media News, covering breaking news, public affairs, entertainment, community developments and regional stories across Trinidad and Tobago, the Caribbean and internationally.
