THE peso breached the P62-per-dollar mark on Friday to new all-time low, and the stock market also slipped below 6,000 as investors remained cautious about global risks and the impact of tighter monetary policy on economic growth.
The peso began the day at P62.05 to the dollar, already exceeding the previous record of P61.888:$1 hit on Thursday. It traded as much as P62.27 to the greenback before closing at P62.265:$1, 37.7 centavos weaker.
The benchmark Philippine Stock Market index, meanwhile, shed 48.25 points, or 0.80 percent, to a close of 5,956.33. The broader All Shares also slipped, by 20.51 points, or 0.61 percent, to 3,318.99.
Reyes Tacandong & Co. senior adviser Jonathan Ravelas said the peso fell as the greenback strengthened amid renewed Middle East concerns and ahead of Federal Reserve Chairman Warsh’s speech at the Jackson Hole Symposium.
Despite Thursday’s Bangko Sentral ng Pilipinas’ (BSP) 25-basis-point rate hike, the currency remained under pressure as external factors continued to weigh on sentiment.
“The peso’s move beyond the P62/US$ level reflects the continued dominance of external factors over domestic drivers,” Union Bank of the Philippines chief economist Ruben Carlo Asuncion said.
He tagged broad dollar strength, elevated oil prices and lingering uncertainty in global financial markets as factors, and added that demand for the greenback from importers and investors likely also contributed.
The Philippines remains vulnerable to sustained dollar strength because of its reliance on imported fuel and other essential commodities, Asuncion said. Higher oil prices could increase the country’s import bill while adding pressure on both the peso and inflation.
John Paolo Rivera, senior economist at the Philippine Institute for Development Studies, said the key concern was whether the depreciation persists and translates into broader inflationary pressures.
“For now, the situation warrants close monitoring rather than alarm,” he said.
Ravelas said the peso could trade within the P61.90-62.30 range in the near term, with geopolitical risks continuing to drive market sentiment.
Regina Capital Development Corp. head of sales Luis Limlingan, meanwhile, said intense selling pressure persisted at the stock market, with the MSCI Philippine Index rebalancing accounting for a significant portion of volume.
The rebalancing triggered broad-based selling as investors adjusted their positions while sentiment was further weighed by the BSP rate hike, he added.
The market ended with 88 gainers, 120 decliners and 49 unchanged issues, with total turnover reaching P18.12 billion, excluding extraordinary block sales.
Philstocks Financial Inc. research manager Japhet Tantiangco said concerns over the possible effects of further BSP tightening on economic growth continued to dampen sentiment.
The Asean +3 Macroeconomic Research Office’s having slashed the Philippines’ 2026 and 2026 growth outlooks also weighed on the market, he added.
Foreign investors were net sellers, recording P3.51 billion in net outflows.
Mining and oil led the sectoral gainers, rising 1.91 percent, while financials posted the steepest decline at 1.78 percent.
Asuncion said the peso was likely to remain volatile in the near term, with the BSP’s tightening action providing some support but a sustained recovery to depend on easing oil prices, a softer dollar and improved global risk sentiment.
“For now, external developments remain the key driver of peso movements,” he said.
