MANILA - The Philippine peso continued its losing streak against the US dollar, closing at yet another record low of P59 to $1 on Monday, Oct. 3.
Monday's close was lower than the previous record of P58.99.
The currency briefly touched P59.02 intraday on Sept. 28.
Further peso depreciation against the dollar is seen as the US Federal Reserve signals more rate hikes in the near term starting with its meeting in early November. The Bangko Sentral ng Pilipinas is also set to hold a monetary policy meeting on Nov. 17, which is a few weeks behind the Fed's schedule.
BDO Capital President Ed Francisco said the Fed's anticipated hike next month could prompt the central bank to implement another off-cycle interest rate hike ahead of its scheduled meeting to lessen the interest rate differential, which could affect the peso.
"We would not be surprised if they do an off-cycle increase again because if the Fed FOMC (Federal Open Market Committee) will increase in November, when that happens, the peso might depreciate further. Hopefully not as much again because of the Christmas season," Francisco said.
The BSP in July implemented a 75-basis point off-cycle interest rate hike ahead of its scheduled meeting. So far, the BSP raised the benchmark rate to 4.25 percent to cool down inflation.
Interest rate hikes can also help in "stabilizing" the peso, BSP Gov. Felipe Medalla said.