Peso hits new low, sinks further below 60:$1
The Philippine peso slipped to a fresh record low on Monday, sinking deeper into the 60-to-the-dollar range—a threshold that may hold, at least for now, as escalating tensions in the Middle East show few signs of easing.
The local currency closed at 60.3 at the start of the trading week, down 20 centavos from its prior all-time low finish of 60.1 set on March 19. It briefly slid to an intraday low of 60.37 before paring some losses.
Trading volume reached $1.7 billion, thinner than the $2.4 billion recorded in the prior session.
Traders pointed to dimming hopes of de-escalation in the Middle East as a key driver of the peso’s persistent weakness, with investors seeking refuge in safe-haven assets like the US dollar.
Over the weekend, US President Donald Trump threatened strikes on Iran’s power infrastructure, prompting Tehran to vow retaliation against assets in neighboring countries.
The head of the International Energy Agency warned that the crisis triggered by the US-Israel attacks on Iran could surpass the combined shock of the 1970s oil crises and the disruption caused by Russia’s 2022 invasion of Ukraine.
“Expect the currency to trade within the 60 to 60.5 levels in the near term, as uncertainty persists,” a trader said.
Still, another trader struck a more cautious note, suggesting the peso’s move past 60 may prove fleeting.
“The 60 handle looks more like a near-term overshoot than a new anchor—likely to linger while uncertainty is high, but not sticky,” the trader said. “A pullback below 60 is still plausible once external pressures ease.”
A weaker peso carries mixed consequences for the Philippines.
It boosts the domestic value of remittances sent home by millions of overseas workers and could help make Filipino exports more competitive.
But the weakness also risks driving up import costs and reigniting inflation. Prolonged depreciation could likewise inflate the peso value of foreign debt held by the government and private firms.
The war, now on its fourth week, has disrupted traffic in the Strait of Hormuz—a key route for roughly a fifth of global oil supply—raising concerns over energy prices for oil-importing economies like the Philippines.
Bangko Sentral ng Pilipinas Governor Eli Remolona Jr. has warned that policymakers could raise interest rates if oil prices remain above $100 for an extended period and the US dollar continues to strengthen. Such a move could help contain demand-driven inflation and stem capital outflows, but may also complicate the economy’s fragile recovery from the flood control scandal.
For now, the central bank said its intervention in the foreign-exchange market was “limited to tempering large swings that could affect inflation rather than defending any specific level.”
“Expect the currency to trade within the 60.000-60.500 levels in the near term, as uncertainty persists,” said Jonathan Ravelas, senior adviser at Reyes Tacandong & Co.
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