Philippine peso depreciates to another record low of P58.49 to $1

ABS-CBN News

Posted at Sep 22 2022 04:40 PM

MANILA - The Philippine peso fell to yet another record low against the US dollar, following the US Federal Reserve's latest big time rate hike, data from the Bankers Association of the Philippines showed. 

The peso on Thursday closed at P58.49 to $1, which was weaker than Wednesday's close of P58 to a dollar, BAP data showed. It fell to as low as P58.5 in intraday trading.

Despite the continued depreciation, the peso is not the worst performer in the region, an official of the Asian Development Bank earlier said.

Currencies globally, such as the Japanese yen and other currencies in the region, have taken a hit mainly due to the dollar rally following the latest US Fed rate hike. 

Bangko Sentral ng Pilipinas Deputy Governor Francisco Dakila also said the peso's movement is natural in a growing economy. The central bank, as an inflation-targeting agency, is ready to "respond" to the foreign exchange if it poses risks to inflation, he said.

“The peso’s movement is natural consequences of current account dynamics of a growing economy,” Dakila said.

The BSP on Thursday raised the country's benchmark interest rate by 50-basis points to 4.25 percent. 

“The intention [of the interest rate hike] is not to target a certain level (of exchange rate)… the priority is bringing inflation back to the target band,” he added.

BSP Gov. Felipe Medalla said interest rate hikes are seen to help stabilize the peso. 

Meanwhile, the continued strengthening of the dollar is expected as the US Fed signals more rate hikes in the near term, making it possible for the peso to hit a low of P60 to $1, First Metro Securities’ Equity Research Deputy Head for Retail Royce Aguilar earlier said.

Previous peso close:
Jan. 3 = P50.999 [first trading day of 2022]
Sept. 16 = P57.43
Sept. 19 = P57.40
Sept. 20 = P57.48
Sept. 21 = P58

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