Marcos announces Malampaya gas discovery

The Philippines has made its first major natural gas discovery in more than a decade, a development that could strengthen domestic energy supply and support rising power demand, President Ferdinand R. Marcos, Jr. said on Monday.

The reservoir, called Malampaya East-1, lies about 5 kilometers east of the existing Malampaya gas field off Palawan province

“This additional resource can help support the government’s efforts for the stabilization of our power supply,” Mr. Marcos said in a video posted on his Facebook page.

The field is estimated to hold about 98 billion cubic feet of gas in place. This is equivalent to roughly 14 billion kilowatt-hours of electricity a year, enough to supply about 5.7 million households annually.

The discovery is expected to extend Malampaya’s role in the country’s energy mix and reinforce domestic gas supply in the coming years.

Initial tests showed the well flowing at about 60 million cubic feet of gas per day, a level Mr. Marcos said is comparable to the original Malampaya wells and indicates strong productivity.

The find also includes condensate, a high-value liquid fuel that could further support efforts to stabilize electricity supply. — Chloe Mari A. Hufana

Philippine banks’ NPL ratio eases in November

The Philippine banking system’s gross nonperforming loan (NPL) ratio eased at end-November, preliminary data from the Bangko Sentral ng Pilipinas (BSP) showed.

Philippine banks’ gross NPL ratio dipped to 3.32% as of November 2025 from 3.33% the prior month and from the 3.54% seen in the same month in 2024.

This was the lowest bad loan ratio since end-September or when it settled at 3.31%.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said recent rate cuts helped encourage loan repayments, easing banks’ NPL ratio at end-November.

The key policy rate now stands at a three-year low of 4.5% as the central bank has delivered a total of 200 basis points (bps) in cuts since August 2024.

The BSP also lowered large banks’ reserve requirement ratio (RRR) to 5%, which Mr. Ricafort said increased the banking system’s liquidity and lenders’ loanable funds.

“All of these reduced borrowing costs and improved the ability to pay by various borrowers, thereby leading to (a) slightly lower (and) better NPL ratio,” he said in a Viber message.

Loans are considered nonperforming once they are unpaid for at least 90 days after the due date. These are deemed risk assets since borrowers are unlikely to pay.

The amount of banks’ soured loans edged up by 1.46% month on month to PHP 544.863 billion at end-November from PHP 537.028 billion at end-October. Nonperforming loans climbed by 4.69% from the PHP 520.477 billion in November 2024.

In the first 11 months, the total loan portfolio of the banking system reached PHP 16.411 trillion, rising by 1.91% from the PHP 16.104 trillion at end-October and by 11.49% from PHP 14.719 trillion in the same period in 2024.

Past due loans inched up by 1.18% to PHP 695.982 billion as of November from PHP 687.836 billion in the previous month and by 9.52% from PHP 635.478 billion at end-November 2024.

Still, banks’ past due loan ratio fell to 4.24% from 4.27% in October and 4.32% a year ago.

Meanwhile, restructured loans dipped by 0.47% to PHP 331.276 billion in November from PHP 332.823 billion in October. Year on year, it grew by 12.79% from PHP 293.702 billion as of November 2024.

This made up 2.02% of the industry’s total loan portfolio, below the 2.07% in October but slightly higher than the 2% recorded a year prior.

On the other hand, banks’ loan loss reserves stood at PHP 517.185 billion in the 11-month period, up 1.75% from PHP 508.273 billion a month ago. It likewise rose by 6.6% year on year from PHP 485.158 billion.

This brought the past due loan ratio to 3.15%, easing from 3.16% as of October and 3.3% at end-November 2024.

Lenders’ NPL coverage ratio, which gauges the allowance for potential losses due to bad loans, climbed to 94.92% in the 11 months to November from 94.65% in the previous month and 93.21% as of November 2024.

“The continued double-digit growth in banks’ loans mathematically broadens the loan base that fundamentally reduces the NPL ratio, especially if NPLs are tempered through credit risk management that is better aligned with global best practices,” Mr. Ricafort said.

Based on separate BSP data, bank lending posted a steady growth in November. It expanded by 10.3% year on year, matching October’s pace, to PHP 13.988 trillion from PHP 12.676 trillion. — Katherine K. Chan, Reporter

BSP’s ‘nonchalance’ amid peso slump still reasonable

The Bangko Sentral ng Pilipinas’ (BSP) minimal intervention in the foreign exchange market is deemed reasonable as the peso’s recent swings remain manageable despite successively hitting record lows in the past weeks, analysts said.

“The BSP’s strategy of minimal intervention is largely reasonable and consistent with its general nonchalance rhetorically about the peso’s weakness,” Miguel Chanco, chief emerging Asia economist at Pantheon Macroeconomics, told BusinessWorld in an e-mail.

“While the level of the peso-dollar exchange rate is understandably attracting more attention these days, what matters ultimately for inflation is its rate of change year over year,” he added. “And, on this basis, panic would be very premature.”

According to Pantheon Macroeconomics, the peso has depreciated against the US dollar by an annual 1.4% as of January. This was slightly higher than the 0.8% decline posted in December, though Mr. Chanco noted that this remains “very manageable in the grand scheme of things.”

Since Jan. 5 or the second trading day of the year, the peso has closed at the PHP 59-per-dollar level.

On Jan. 15, it fell by two centavos to close at PHP 59.46 versus the greenback, breaking the previous all-time low of PHP 59.44 against the dollar on Jan. 14.

BSP Governor Eli M. Remolona, Jr. earlier said that they feel “tremendous pressure” to defend the peso amid its recent volatility, but they choose to disregard it.

Still, he noted that the central bank continues to make minimal interventions in the foreign exchange market to prevent sharp movements that may cause inflationary pressures.

Meanwhile, John Paolo R. Rivera, a senior research fellow at the Philippine Institute for Development Studies, noted that extended peso weakness might worsen inflation on imports and erode confidence in the currency.

“BSP’s light touch forex (foreign exchange) approach is acceptable while markets are orderly, but prolonged PHP (Philippine peso) weakness risks imported inflation and weaker confidence if expectations become unanchored,” Mr. Rivera told BusinessWorld in a Viber message.

“This depreciation could reduce the likelihood of a near-term rate cut, as the BSP may turn more cautious to avoid fueling price pressures unless inflation stays firmly within target and the PHP stabilizes,” he added.

In December, the Monetary Board delivered its fifth straight 25-basis-point (bp) cut, bringing the benchmark policy rate to an over three-year low of 4.5%. It has so far reduced key borrowing costs by 200 bps since it began its easing cycle in August 2024.

The BSP chief has said that another 25-bp reduction at their Feb. 19 meeting remains on the table but may be unlikely considering current economic data.

Jonathan L. Ravelas, a senior adviser at Reyes Tacandong & Co., said that the peso’s continued slump makes it difficult to justify any further easing soon, putting the BSP in a “tricky spot.”

“By keeping interventions minimal, the BSP preserves its reserves and signals confidence, but the risk is that a weaker peso quietly pushes imported prices higher and keeps inflation sticky,” he told BusinessWorld via Viber. “And because every bout of depreciation widens the rate gap with the Fed, the peso’s weakness makes a February rate cut much harder to justify.”

Mr. Ravelas noted that recent peso movements may be urging the central bank to pivot from easing to maintaining stability.

Still, the prevailing macro backdrop, particularly tepid economic growth, could outweigh peso concerns in shaping the BSP’s monetary policy.

This, Mr. Chanco said, would likely prompt the central bank to deliver a sixth straight 25-bp cut in February to end its easing cycle.

“Of course, it would be an entirely different story if inflation was above the BSP’s target range and the PHP was wobbling more materially, but we’re nowhere near this scenario,” he added. — Katherine K. Chan, Reporter

Philippine remittances slip to six-month low in November

Money sent home by overseas Filipino workers (OFW) fell to its lowest level in six months in November, the Bangko Sentral ng Pilipinas (BSP) reported.

Preliminary central bank data released on Thursday showed that cash remittances coursed through banks rose by 3.6% to USD 2.91 billion from USD 2.808 billion in the same month in 2024.

This was the lowest remittance level recorded in six months or since the USD 2.658 billion in May.

In terms of growth, November marked the fastest pace in two months or since the 3.7% in September.

Meanwhile, remittances declined by 8.2% from USD 3.171 billion in October.

“November’s dip is really just a timing story,” Jonathan L. Ravelas, a senior adviser at Reyes Tacandong & Co., said in a Viber message. “A lot of the holiday money was already sent in October, which is why we saw that month heavy with remittances — partly due to pre‑holiday transfers and even typhoon‑related aid being front‑loaded.”

Mr. Ravelas noted that the month-on-month dip was not a “red flag” as it is a usual trend seen before remittances surge in December.

In November, land-based OFWs sent home the bulk of cash remittances, which went up by 3.6% year on year to USD 2.303 billion.

Remittances from sea-based workers likewise grew by an annual 3.6% to USD 606.592 million in November.

BSP data also showed that personal remittances, which include both cash coursed through banks and informal channels and in-kind remittances, rose by 3.6% to USD 3.235 billion in November from USD 3.121 billion in the previous year.

Metropolitan Bank & Trust Co. Chief Economist Nicholas Antonio T. Mapa said movements in the foreign exchange market likely drove the annual growth in remittances.

In November, the peso touched the PHP 59-per-dollar level several times. It even closed at PHP 59.17 against the greenback on Nov. 12, breaking the previous record of PHP 59.13 seen on Oct. 28.

“Despite this development, remittances proved to be a solid and reliable source of FX (foreign exchange) while also translating into healthy purchasing power that likely helped drive holiday spending,” Mr. Mapa said in a Viber message.

11-month climb

As of November, cash remittances from migrant Filipinos reached USD 32.111 billion, climbing by 3.2% from USD 31.113 billion during the same period in 2024.

Remittances from land-based workers grew by 3.3% year on year to USD 25.66 billion as of end-November, while sea-based OFW remittances rose by 2.8% to USD 6.45 billion.

On the other hand, personal remittances in the 11-month period stood at USD 35.727 billion, up by 3.2% from USD 34.608 billion at end-November 2024.

“The United States remained the top source of remittances to the Philippines during January-November 2025, followed by Singapore and Saudi Arabia,” the BSP said in a statement.

Based on BSP data, money sent home from the US accounted for 40% of the remittances in the 11 months to November.

Inflows from Singapore made up 7.1% of the total remittances, followed by Saudi Arabia (6.4%), Japan (5%), the United Kingdom (4.6%), the United Arab Emirates (4.6%), Canada (3.5%), Qatar (2.9%), Taiwan (2.8%) and South Korea (2.4%).

The US was the top source of land-based remittances at end-November with 41.9% of total remittances. The rest came from Saudi Arabia (8%), Singapore (6.4%), the United Arab Emirates (5.7%) and the UK (4.5%).

Meanwhile, 32.2% of the remittances from sea-based workers were from the US, followed by Singapore (10.2%), Japan (7.1%), Germany (5.5%) and the UK (5.4%).

The BSP expects cash remittances to grow by 3% to USD 35.5 billion this year. —Katherine K. Chan, Reporter

Job shortage tops worries of Philippine business leaders — WEF

A shortage of jobs is emerging as the biggest worry for Philippine business leaders, according to the World Economic Forum (WEF), a sign that economic growth risks falling short of what’s needed to absorb workers over the next two years.

Philippine executives ranked weak public services and social protection as their second concern in the WEF’s 2026 Global Risks Report, with respondents pointing to shortcomings in education, infrastructure and pension systems.

Business leaders also flagged the spread of misinformation and disinformation, unintended effects of artificial intelligence, and inflation as key threats to the economy.

Leonardo A. Lanzona, an economics professor at the Ateneo de Manila University, said the Philippine executives’ concern over jobs reflects the recent economic slowdown.

“As the economy screeches to a slowdown as a result of the decrease in government expenditures, aggregate demand decreases,” he said in a Messenger chat.

The lack of additional opportunities is also causing a number of businesses, particularly micro, small, and medium enterprises, to fail, Mr. Lanzona said.

“Consequently, this economic slowdown brings about significant unemployment,” he added.

In the first 11 months of 2025, the unemployment rate averaged 4.19% or equivalent to 2.25 million jobless Filipinos. This is higher than the 3.9% jobless rate, which is equivalent to 1.66 million in the same period in 2024.

“As most of the budget is eaten by debt, the situation is aggravated by lower social protection, political infighting, and a labor-saving technology such as AI (artificial intelligence) that can further reduce labor demand,” Mr. Lanzona said.

Meanwhile, the WEF report showed globally, the biggest risk over the next two years remained geoeconomic confrontation.

The WEF’s Global Risks Perception Survey captured insights from over 1,300 experts worldwide.

Other top risks cited by global business leaders included misinformation and disinformation, societal polarization, extreme weather events, and state-based armed conflict.

“Geoeconomic confrontation has emerged as the most severe risk over the next two years, while economic risks have experienced the sharpest rises among all risk categories over the two-year timeframe,” WEF Managing Director Saadia Zahidi said.

Rising inflation and potential asset worries rose as countries face high debt burdens and volatile markets amid growing concerns over an economic downturn, she said.

The WEF noted that 18% of surveyed participants identified geoeconomic confrontation as the top risk likely to trigger a material global crisis in 2026.

This was followed by state-based armed conflict (14%), extreme weather events (8%), societal polarization (7%), misinformation and disinformation (7%), and economic downturn (5%).

Meanwhile, over the next 10 years, survey participants expect extreme weather events to become even more severe. — Aubrey Rose A. Inosante

Peso slips to fresh record low on rate cut bets

The Philippine peso weakened to a new record low against the dollar on Thursday as markets priced in the possibility that the Bangko Sentral ng Pilipinas (BSP) could cut interest rates ahead of the US Federal Reserve.

The local currency closed at PHP 59.46 a dollar, down two centavos from Wednesday’s record-low finish of PHP 59.44, data from the Bankers Association of the Philippines showed.

The peso opened Thursday’s session slightly stronger at PHP 59.43, touched an intraday high of PHP 59.35, and weakened to as low as PHP 59.47. Dollar trading volume rose to USD 1.079 billion, higher than the USD 951 million recorded the previous day.

“The dollar-peso closed higher on prospects of a narrowing interest rate differential, with the BSP expected to cut rates before the Fed,” a trader said by telephone.

Another trader said the peso continued to soften after recent US producer inflation and retail sales data underscored the resilience of the American economy, reinforcing expectations that the Fed will keep policy rates unchanged in the coming months.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said market expectations of a BSP rate cut at its February policy meeting also weighed on the peso.

BSP Governor Eli M. Remolona, Jr. said last week that a rate cut at the Monetary Board’s Feb. 19 meeting “remains on the table” but is “unlikely,” as the central bank is nearing the end of its easing cycle.

The BSP has reduced its benchmark rate by a total of 200 basis points since August 2024, bringing the policy rate to a more than three-year low of 4.5%.

Despite the peso’s weakness, the BSP sees no need for immediate intervention. Palace Press Officer Clarissa A. Castro said the central bank continues to closely monitor exchange-rate movements and is prepared to act if necessary.

“The Bangko Sentral ng Pilipinas continues to monitor the peso-dollar exchange rate so it can take appropriate action if needed,” she told a news briefing in Filipino. “For now, the central bank is confident that intervention is not required.”

She said the peso’s depreciation reflects global developments, including the strength of the US dollar driven by expectations on Fed policy and geopolitical tensions abroad.

The government is working to mitigate the impact of a weaker peso by slowing price increases, supporting investments, and strengthening key economic sectors, she added.

MUFG Global Markets Research Senior Currency Analyst Michael Wan said the peso might remain more sensitive to oil price movements than some of its regional peers, although further oil price increases are not his base case scenario.

“Further oil price increases is not our base case, and we will look to see if the peso retraces some weakness on these recent oil price moves,” he said.

Traders said the peso could continue testing record lows until the BSP and Fed hold their respective policy meetings, unless the US central bank signals a shift toward rate cuts.

However, movements will remain data-dependent, particularly on US inflation and labor market indicators.

For Friday, the first trader sees the peso trading from PHP 59.20 to PHP 59.50 a dollar, while the second trader expects a range of PHP 59.25 to PHP 59.50.

Mr. Ricafort said the local currency could move from PHP 59.35 to PHP 59.55, noting that strong foreign exchange reserves and continued net foreign buying in the local stock market might help cushion further depreciation. — Aaron Michael C. Sy

Philippine shares rebound on World Bank forecast

Philippine stocks climbed back above the 6,400 level on Thursday, boosted by the World Bank’s growth forecast for 2026 and speculation that the Bangko Sentral ng Pilipinas (BSP) could trim interest rates.

The benchmark Philippine Stock Exchange index (PSEi) rose 1.52% or 97.72 points to 6,487.53, its strongest finish in six months. The broader all-share index gained 0.68% or 24.76 points to 3,660.7.

Foreign investors were net buyers, pumping PHP 1.31 billion into the market, up from PHP 291.46 million a day earlier.

“The local bourse surged on the back of a massive foreign buying spree after the World Bank forecast of a 5.3% GDP (gross domestic product) growth for fiscal year 2026 renewed investors’ confidence in buying the Philippine consumer growth story,” AP Securities, Inc. said in a market note.”

The World Bank expects the economy to expand 5.3% in 2026 — within the government’s 5-6% target — and 5.4% in 2027, below the 5.5-6.5% goal, citing governance challenges.

Investors also speculated that the BSP might cut rates at its Feb. 19 policy meeting, although Governor Eli M. Remolona, Jr. has said the benchmark is already “very close” to its desired level.

“Buying was supported by hopes that the BSP will go for another rate cut in their upcoming policy meeting, and that the local economy would eventually be able get back to its fast growth pace,” Philstocks Financial Research Manager Japhet Louis O. Tantiangco said in a Viber message.

Sector gains were broad-based. Services led the rally with a 2.01% gain, followed by property at 1.53%, financials at 1.44%, holding firms at 1.13% and industrials at 0.18%.

On the other hand, mining and oil fell 1.01%.

DigiPlus Interactive Corp. led index members, climbing 4.59% to PHP 16.40, while JG Summit Holdings, Inc. fell 1.34% to PHP 25.85 amid profit-taking.

Trading was active, with value turnover rising to PHP 7.3 billion from PHP 6.92 billion and 2.02 billion shares changing hands, compared with 1.86 billion on Wednesday.

Advancers outnumbered decliners 115 to 96, with 58 stocks unchanged.

Market analysts said foreign inflows and optimism over consumer spending were key drivers of the rebound.

“Broad-based buying prevailed in today’s session, which was mainly led by services and property, while mining and oil headed the opposite direction,” AP Securities said. — Alexandria Grace C. Magno

Peso slides to record low PHP 59.44 per USD

The Philippine peso slid to a record low of PHP 59.44 a dollar at Wednesday’s close, failing to sustain support seen late last year due to renewed demand for the greenback amid heightened geopolitical tensions.

The local currency weakened by 9.9 centavos from Tuesday’s 59.341 finish, according to Bankers Association of the Philippines data posted on its website. The close broke the previous record low of PHP 59.355 on Jan. 7.

The peso opened Wednesday’s trading session weaker at PHP 59.38 versus the dollar. Its intraday best was at PHP 59.35, while its worst showing was at PHP 59.45 against the greenback.

Dollars traded inched down to USD 951 million on Wednesday from USD 999.2 million on Tuesday.

Demand for the greenback persisted on Wednesday amid geopolitical concerns arising from the tariffs imposed by US President Donald J. Trump against Iran and its trading partners, a trader said by telephone.

The trader also cited increasing bets of fewer rate cuts by the US Federal Reserve this year.

This as the Trump administration threatened Fed Chair Jerome H. Powell with criminal indictment over his testimony before the US Senate regarding the renovation of the Fed’s headquarters in Washington, D.C.

The peso was also dragged by the local government’s reduction of its infrastructure spending target for the year, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

The Department of Budget and Management cut its infrastructure spending target to 4.3% of gross domestic product (GDP) this year from 5.1% previously following weaker government spending and economic growth last year due to the flood control scandal.

The lower target translates to about PHP 1.3 trillion in infrastructure outlays, Acting Budget Secretary Rolando U. Toledo said on Tuesday.

Mr. Ricafort noted that the peso moved within familiar ranges on Wednesday, signaling possible interventions from the central bank.

“So far, the signals have been consistent that [the Bangko Sentral ng Pilipinas (BSP) has] been on intervention in recent months and at least for more than three years already. So, these are familiar levels because the previous record high for more than three years was PHP 59,” he told Money Talks with Cathy Yang on One News on Wednesday.

AIA Investment Management Philippines Chief Executive Officer Angie L. Pacis said in the same program that the peso could test the P62 level due to growing interest rate differentials between the Philippines and the US.

“We’re actually of the camp that, for now, based on what we see, maybe the rate cut in February is actually iffy, simply because the BSP is already within their 2-4% [inflation] target range,” she said.

BSP Governor Eli M. Remolona, Jr. said last week that a rate cut at the Monetary Board’s Feb. 19 meeting “remains on the table” but was “unlikely.” He also noted that the BSP is nearing the end of their easing cycle.

The Monetary Board has delivered 200 basis points in reductions since August 2024, bringing the policy rate to an over three-year low of 4.5%.

For Thursday, the trader said the market players will await developments with Mr. Trump’s subpoenas against Mr. Powell.

The peso could also be weighed by US producer inflation data which are expected to remain high and could further fuel hawkish Fed expectations, the trader added. The data will be released overnight.

The trader sees the peso moving between PHP 59.20 and PHP 59.60 per dollar on Thursday, while Mr. Ricafort expects it to range from PHP 59.35 to PHP 59.55. — Aaron Michael C. Sy, Reporter

Philippine banks’ loan growth steadies in Nov.

Philippine banks’ loan growth held steady in November, preliminary data from the Bangko Sentral ng Pilipinas (BSP) showed.

Outstanding loans of universal and commercial banks, net of reverse repurchase agreements, grew by 10.3% year on year to PHP 13.988 trillion in November from PHP 12.676 trillion in the same month in 2024.

November’s growth rate matched the pace of October. October saw the slowest growth in bank lending since the 10.1% recorded in June 2024.

On a seasonally adjusted basis, bank lending expanded by 0.9% month on month.

“Outstanding loans from universal and commercial banks (U/KBs) to businesses and individual consumers expanded in November,” the central bank said in a statement released late on Tuesday.

“Preliminary data show that loans from U/KBs grew at a steady rate of 10.3% year on year in November,” it added.

BSP data showed that big banks’ outstanding loans to residents grew by an annual 10.7% to PHP 13.681 trillion in November, slightly easing from the 10.9% growth seen in the previous month.

On the other hand, loans to nonresidents fell by 4.5% year on year to PHP 307.253 billion from the 11.1% drop logged in October.

Banks’ loans to residents for production activities grew by 9% to PHP 11.789 trillion in November, slowing from 9.1% in the previous month.

This as lending for electricity, gas, steam, and air-conditioning supply sector jumped by 26.6%. Other segments that showed growth in lending include transportation and storage (12.7%); wholesale and retail trade, repair of motor vehicles and motorcycles (11.6%); real estate activities (9%); information and communication (7%); and financial and insurance activities (3.5%).

Meanwhile, big banks’ consumer loans to residents — which account for credit card, motor vehicle, and general-purpose salary loans but exclude residential real estate loans — rose by 22.9% in November to PHP 1.892 trillion, slightly slower than the 23.1% growth in October.

Broken down, credit card loans jumped by 29.5% to PHP 1.158 trillion, picking up from the 29.2% growth in October, while lending growth for motor vehicles eased to 16.3% at P524.037 billion from 17.6% in the previous month.

On the other hand, loans for general-purpose salaries reached PHP 164.932 billion in November, climbing by 6.4%. This is a tad faster than 5.8% a month ago.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the consistent double-digit expansion in bank lending can help spur the local economy, especially after the sharp slowdown in the third quarter of 2025.

“Banks’ loan growth still at double-digit levels could still bode well as a leading indicator to the broader economic growth,” he said in a Viber message.

Mr. Ricafort noted that the 10.3% loan growth in November was mainly because of the fast growth in consumer loans, particularly credit card and motor vehicle loans, “amid the country’s favorable demographics.”

In the coming months, banks may see more demand for loans if the BSP lowers key borrowing costs and the reserve requirement ratio (RRR) further to match the Federal Reserve’s moves.

“Loan growth could continue to sustain at double-digit growth levels if the Fed cuts rates further in the coming months that could be matched by the BSP, alongside possible cut/s in local banks’ RRR, all of which could further reduce borrowing costs that could spur greater demand for loans or credit and help boost investments and overall economic growth,” Mr. Ricafort said.

The Monetary Board has so far slashed the benchmark policy rate by a total of 200 bps since August 2024, bringing it to its lowest in over three years at 4.5%.

BSP Governor Eli M. Remolona, Jr. left the door open for another 25-bp cut at its first meeting this year on Feb. 19, though noted that the current easing cycle is nearing its end as the current policy rate is approaching their neutral rate.

On the other hand, the Fed has so far delivered 175 bps in cuts since September 2024, bringing its key policy rate to the 3.5%-3.75% range. It is scheduled to have its first meeting this year on Jan. 27-28.

Money supply

Meanwhile, separate BSP data showed that domestic liquidity (M3) rose by 7.6% year on year to PHP 19.439 trillion in November from PHP 18.071 trillion. This was slower than the 8.3% climb in October.

M3 is considered as the broadest measure of liquidity in an economy.

The country’s money supply expanded by 1.2% month on month on a seasonally adjusted basis.

Domestic claims, which include claims from private and government entities, jumped by an annual 10.6% year on year to PHP 21.984 trillion, picking up from the 10.5% growth in October.

This as higher borrowings boosted net claims on the central government by 11% to PHP 5.888 trillion. This was up from 10% growth a month earlier.

Meanwhile, claims on the private sector rose by 11.1% to PHP 14.162 trillion, faster than the 11% the previous month, amid “continued expansion in bank lending to non-financial private corporations and households.”

Claims on a sector refer to that sector’s liabilities to depository corporations such as banks and the central bank.

Central bank data also showed net foreign assets (NFA) in peso terms climbed by 4.4% in November versus the 2.1% expansion in October.

“NFAs of the BSP increased by 1.9%,” the BSP said. “Similarly, NFAs of banks grew primarily on account of lower foreign currency-denominated bills payable.”

Broken down, the central bank’s NFAs grew by 1.9% year on year, a turnaround from the 0.4% decline in October, while banks’ NFA climbed by 26.9%, slightly faster than the 26.3% the previous month.

NFAs reflect the difference between depository corporations’ claims and liabilities to nonresidents.

“The BSP monitors bank loans because they are a key transmission channel of monetary policy,” the central bank said. “Looking ahead, the BSP will ensure that domestic liquidity and bank lending conditions remain aligned with its price and financial stability objectives.” — Katherine K. Chan

Philippine stocks extend slide as peso hits record low

Philippine shares fell for a second session on Wednesday after the peso slid to a record low, weighing on investor sentiment.

The benchmark Philippine Stock Exchange index dropped 0.29% to 6,389.81, while the broader all-share index slipped 0.06% to 3,635.94.

Late selling pulled the market lower, with sentiment pressured by the peso’s weakness and higher global oil prices amid tensions in Iran, Philstocks Financial, Inc. Research Manager Japhet Louis O. Tantiangco said.

“The peso’s weakness also weighed on the bourse,” he said in a Viber message.

The local currency closed at PHP 59.44 a dollar, down 9.9 centavos from its previous finish, according to Bankers Association of the Philippines data. This marked its weakest close on record, surpassing the PHP 59.355 logged on Jan. 7.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the decline reflected mild profit-taking after recent gains, following the government’s decision to trim its infrastructure spending target.

The Department of Budget and Management lowered the infrastructure spending goal to 4.3% of gross domestic product this year from 5.1%, citing the need for more cautious disbursement after a corruption scandal weighed on spending and growth last year.

Acting Budget Secretary Rolando U. Toledo said the revised target translates to about PHP 1.3 trillion.

Despite Wednesday’s dip, Mr. Ricafort said the index remains at its highest levels in more than five months, supported by gains since late December and continued foreign inflows.

Sectoral performance was mixed. Mining and oil stocks rose 1.81%, while holding firms gained 1.57% and industrials added 0.58%.

On the other hand, services fell 1.76%, while financials declined 1.2%.

JG Summit Holdings, Inc. led index gainers, climbing 4.8% to PHP 26.20. China Banking Corp. was the worst performer, sliding 3.72% to PHP 60.70.

Decliners beat advancers 97 to 95, with 71 stocks unchanged. Value turnover rose to PHP 6.92 billion, with 1.86 billion shares traded, compared with PHP 6.75 billion and 1.26 billion shares in the previous session.

Foreign investors remained net buyers, though inflows eased to PHP 291.46 million from PHP 506.15 million a day earlier.

Markets also tracked global developments, including softer US equities and higher oil prices, which added pressure on risk assets.

Analysts said the peso’s direction and policy signals from the Bangko Sentral ng Pilipinas would remain key drivers in the near term. — Alexandria Grace C. Magno

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