By Tracy Cabrera
MALATE, Manila — The Philippine peso nearly breached the ₱62-per-dollar level on Thursday after falling to a new intraday low of ₱61.995 against the US currency before closing at ₱61.815:$1, down by three centavos from the previous session, according to data from the Bangko Sentral ng Pilipinas (BSP).
The weakening peso triggered a sharp decline in the local stock market, with the benchmark Philippine Stock Exchange index (PSEi) dropping 106.36 points, or 1.70 percent, to finish at 6,158.34.
UnionBank chief economist Ruben Carlo Asuncion attributed the peso’s slide largely to external pressures, including elevated oil prices, ongoing geopolitical tensions, and sustained strength of the US dollar.
“As a major oil-importing country, the Philippines is highly exposed to rising energy costs, which boost demand for dollars and put additional pressure on the peso,” Asuncion said.
Reyes Tacandong & Co. senior adviser Jonathan Ravelas warned that the local currency could weaken further and may soon test the ₱62-per-dollar mark.
Ravelas said investors have been positioning ahead of the release of the US Federal Reserve’s July Federal Open Market Committee (FOMC) minutes in search of clues on future interest rate movements. He added that uncertainties surrounding developments in the Middle East have also increased demand for the US dollar as a safe-haven asset.
Regina Capital Development Corp. head of sales Luis Limlingan noted that the peso’s decline has intensified worries over inflation and higher borrowing costs, adding pressure on Philippine equities.
Meanwhile, Philstocks Financial Inc. research manager Japhet Tantiangco said rising oil prices and the peso’s record intraday low were fueled by concerns over a possible escalation of tensions in the Middle East, particularly involving the United States and Iran.
ia/xf
