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| Today's exchange rate is the 2nd lowest in history (Inquirer graphic) |
The Philippine peso dropped to its second lowest level against the US dollar when it closed at Php59 to the greenback this afternoon.
This was nine centavos weaker
than its Pp58.91 closing yesterday.
The new exchange rate marks its
lowest closing since it hit Php59.20 : US$1 on Oct 17, 2022.
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This means that the peso’s value
as against the HK dollar which is pegged to the USD has also dropped. The exchange
rate between the two is now Php7.59 vs the HKD.
The peso has been declining with
the rest of Asian currencies in recent days, which a Bloomberg report says is
due to the US dollar’s strengthening following the re-election of Donald Trump
as president.
Investors are also wary of
heightened US-China trade tensions and potential tariff hikes, also due to
Trump’s return to power.
Yesterday, Bangko Sentral ng
Pilipinas Gov. Eli Remolona said that there might be a further easing of key
interest rates due to inflationary pressures.
“We can cut (rates in December)
or we can pause. The move will depend on the data,” Remolona said on the sidelines
of the BSP-IMF Risk Dialogue in Cebu.
“Inflation pressures may cause us
to pause a bit, but weak growth may cause us to cut.”
In a move to shift to a less restrictive
monetary policy, the central bank has been cutting the country’s benchmark
interest rates since August. The key rate is now 50 basis points lower since,
at six percent.
Before the cuts, the BSP kept interest rates steady starting in November 2023.
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