BSP sees stability in position of peso

Bruce Rodriguez, ABS-CBN News

Posted at Mar 20 2021 05:40 AM

BSP sees stability in position of peso 1

MANILA—The Philippine peso will be staying at its current levels, based on the projections of the Bangko Sentral ng Pilipinas.

While the BSP does not give out definite forecasts on the local currency, Francisco Dakila Jr., deputy governor for the monetary and economics sector of the central bank, said Friday there are indicators pointing to a stable peso.

"If you will look again at our assessment of the balance of payments for this year, it continues to be on the side of a surplus. Actually, the outlook is for a stronger surplus compared to what we had projected at the end of 2020," Dakila said. 

"In December, we were projecting a surplus amounting to 0.8 percent of GDP, whereas in our current forecast round, we've increased that to 1.6 percent of GDP."

Dakila also said that while imports could recover once the local economy reopens further they are also expecting an uptick in exports growth this year, thanks to an expected recovery in the global economy.

"So we've actually become more optimistic, and we've revised our exports growth assumption from 5 percent in December to 8 percent as of this forecast round," he said.

That is why the peso will see continued stability in its current position, as well as a very robust external position for the Philippines, Dakila added.

Meanwhile, Zeno Ronald Abenoja, managing director for the BSP's department of economic research, said "possible forces that could support the peso will be the expected tick up of demand coming from the external sector, as the global economy continues to improve."

He added that expectations of a continued expansion in the country's gross international reserve will also further boost the peso.

Last week, the peso declined for 3 straight days as trading at the Philippine Stock Exchange was temporarily halted after the benchmark fell by 10 percent for the 2 straight days.

The PSEi was down 6.46 percent to 5,365.59 before 11 a.m. The peso weakened to P51.25 to the dollar from Thursday's close of P50.85.

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