Peso may be range-bound as mart awaits policy hints from Fed chief

The peso could continue to move sideways against the dollar this week as markets monitor developments at the US Federal Reserve as the Trump administration continues to pressure the central bank to cut interest rates.

On Friday, the local unit closed at PHP 57.065 per dollar, weakening by 12 centavos from its PHP 56.945 finish on Thursday, data from the Bankers Association of the Philippines showed.

Meanwhile, week on week, the peso inched up by 4.5 centavos from its PHP 57.11 close on Aug. 8.

The peso dropped on Friday as the dollar gained early in the session on faster-than-expected July US producer inflation data, which tempered Fed rate cut expectations, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

“The dollar-peso closed higher after stronger than expected US producer price inflation (PPI) data brought down Fed cut bets,” a trader likewise said in a phone interview on Friday.

The dollar held on to previous session gains early on Friday after hotter-than-expected inflation data prompted traders to trim wagers on rate cuts by the Fed, Reuters reported.

Overnight, markets had to contend with US producer prices showing the quickest rise in three years in July amid a surge in the costs of goods and services, pointing to a broad pick up in inflationary pressures which analysts say could pose a dilemma for the Fed.

The hot measure of producer price inflation followed a comforting consumer inflation outcome earlier in the week which had boosted expectations of policy easing in the world’s largest economy and helped lift risk assets across the board. Odds of a 25-basis-point cut by the US central bank retreated slightly after the producer price figures, per CME’s FedWatch tool.

Markets also await this week’s Jackson Hole symposium, where Fed Chair Jerome H. Powell will give a speech, for clues on the Fed’s next move. Signs of weakness in the US labor market combined with any inflation from trade tariffs could present a dilemma for the Fed’s rate cut trajectory.

For this week, the trader said the peso could continue trading sideways against the dollar ahead of the release of the minutes of the Fed’s latest policy meeting.

“Markets are also awaiting developments if the Fed chair will be replaced,” the trader said.

The trader sees the peso moving between PHP 56.80 and PHP 57.30 against the dollar this week, while Mr. Ricafort expects it to range from PHP 56.70 to PHP 57.30. — A.M.C. Sy with Reuters

Bargain hunting, BSP easing hopes may lift PSEi

Philippine stocks may continue to move sideways this week and get a lift from hopes of further monetary easing and bargain hunting as investors wait for new catalysts.

On Friday, the bellwether Philippine Stock Exchange index (PSEi) rose by 0.38% or 24.08 points to close at 6,315.93, while the broader all shares index increased by 0.21% or 8.20 points to 3,751.23.

Week on week, however, the PSEi fell by 0.37% or 23.45 points from the 6,339.38 finish on Aug. 8.

“The PSEi closed marginally lower [last] week as investors sifted through second-quarter earnings data while weighing a potential Federal Reserve rate cut,” online brokerage 2TradeAsia.com said in a market note.

“Profit taking took over last week as local economic concerns weighed on sentiment. The local market has been alternately moving between gains and losses for 10 weeks already as investors remain indecisive of its direction,” Philstocks Financial Inc. Research Manager Japhet Louis O. Tantiangco said in a Viber message.

For this week, Philippine shares could remain range-bound, he said.

“With the market at attractive levels, we may see some bargain hunting in this week’s trading,” Mr. Tantiangco said. “A strong rally is not expected, however, unless we see fresh positive leads. Investors are still expected to maintain a cautious stance while waiting for new catalysts.”

He added that expectations of a rate cut at the Bangko Sentral ng Pilipinas’ (BSP) Aug. 28 policy meeting could give the market support.

Last week, BSP Governor Eli M. Remolona, Jr. said a rate cut is “quite likely” at their meeting this month as inflation is likely to settle within its annual target.

The central bank has lowered borrowing costs by 125 basis points (bps) since it began its easing cycle in August 2024, bringing the benchmark rate to 5.25%.

Mr. Remolona said they are expecting to deliver two more rate cuts this year. However, three reductions are “unlikely.”

Mr. Tantiangco said the PSEi is expected to trade between 6,150 and 6,400 this week. “From a technical standpoint, the local market is still bearishly biased as it continues to form lower highs.”

Meanwhile, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort put the PSEi’s support at 6,204.04 and resistance at 6,591.94.

“BSP Governor Remolona reiterated dovish signals on possible monetary easing in terms of possible two 25-bp rate cuts for the rest of 2025 amid benign inflation and external uncertainties that could slow down local economic growth, signaling policy priority of boosting the local economy,” Mr. Ricafort said in an e-mail.

2TradeAsia.com placed the PSEi’s immediate support at 6,250 and resistance at 6,550.

“The divergence between a potential global risk-on rally and local market lull creates a tactical consideration for market participants… The impending easing cycle may be a significant potential catalyst for equities,” it said. — Revin Mikhael D. Ochave

Gov’t sees poverty incidence falling to as low as 8% by 2028

The Philippine government is confident it can bring down the poverty rate to single-digit levels by 2028.

“While we lowered our growth targets, we remain optimistic about reducing poverty rates to single-digit levels by 2028,” the Department of Economy, Planning, and Development (DEPDev) said in the midterm update of the Philippine Development Plan (PDP) 2023-2028.

Under the updated PDP, the government now aims to reduce the poverty incidence rate to 10-11% by 2027 and 8-9% by 2028. President Ferdinand R. Marcos, Jr.’s term will end in June 2028.

The poverty incidence target stood at 12-13% for 2025.

“Poverty incidence continues to fall, and we are intensifying efforts to ensure that the benefits of economic growth reach all regions and communities,” Economy Secretary Arsenio M. Balisacan said.

Data from the Philippine Statistics Authority (PSA) showed poverty incidence among the population fell to 15.5% in 2023 from the 18.1% estimate in 2021. This translated to 17.54 million poor Filipinos, 12.26% down from 19.99 million in 2021. This exceeded the 2023 poverty rate target of 16-16.4%.

“This indicates that nearly 2.4 million Filipinos were lifted out of poverty. Encouragingly, income growth among the poorer half of the population outpaced that of the wealthier half — signaling meaningful progress toward making economic growth more inclusive,” DEPDev said in the report.

The government has recalibrated the development plan at the midpoint of Mr. Marcos’ term, reflecting emerging domestic and global challenges.

Under the updated PDP, the government is aiming for 5.5-6.5% economic growth this year. It also narrowed the gross domestic product (GDP) target band to 6-7% from 2026 to 2028.

The PDP previously set a 6.5-8% GDP growth target until 2028.

“While slower economic growth typically poses a challenge to reducing poverty, the recent achievement provides a strong rationale for retaining current poverty targets,” DEPDev said.

With sustained focus on key priorities, such as health and food security, DEPDev expects the impact of growth to be more inclusive and pro-poor, supporting the attainment of poverty targets.

“Furthermore, we will enhance the efficiency of social assistance programs by developing a dynamic social registry and refining our targeting protocols. To further empower beneficiaries of ayuda programs, we will link them to initiatives on financial literacy and employment facilitation, enabling them to build resilience and better withstand future shocks,” it said.

UMIC status

Meanwhile, DEPDev said the Philippines is poised to achieve its upper middle-income country (UMIC) status in the “near term.”

“Achieving upper middle-income status is no longer a distant aspiration — it is now within reach,” Mr. Balisacan said.

Under the updated PDP, the government is targeting gross national income (GNI) per capita to reach $4,814-$4,920 this year and $5,124-$5,210 in 2026.

The government aims to have a GNI per capita of $5,452-$5,589 in 2027, and $5,882-$6,081 in 2028.

The World Bank’s latest country income classification released in July showed the Philippines remained a lower middle-income country even as it posted a record-high GNI per capita of $4,470.

The World Bank classifies a country as lower middle income if the GNI per capita level is between $1,136 and $4,495. A country has to have a GNI per capita of $4,496-$13,935 to be classified as upper middle income. — ARAI

June remittances rise 3.7% to six-month high

MONEY SENT home by Filipinos abroad grew faster in June to hit a six-month high, driven by remittances from land-based workers, the Bangko Sentral ng Pilipinas (BSP) said.

Cash remittances coursed through banks jumped by 3.7% year on year to $2.99 billion in June from $2.88 billion, the BSP said on Friday.

This was the highest value of monthly remittances seen in six months or since the $3.38 billion logged in December last year.

The year-on-year increase also picked up from the 2.9% logged in May, when remittances reached $2.66 billion.

“Cash remittances to the Philippines continued to grow in June of this year, with remittances from land-based overseas Filipinos (OFs) increasing faster than funds from sea-based OFs,” the central bank said.

Money sent home by land-based overseas Filipino workers (OFWs) climbed by 3.7% year on year to $2.43 billion in June, making up bulk of the total.

Remittances from sea-based OFWs also rose by 3.5% to $555 million that month.

“The increase in cash remittances drove an increase in personal remittances as well,” the BSP said.

Personal remittances, which include both cash coursed through banks and informal channels and in-kind remittances, climbed by 3.7% to $3.33 billion in June from $3.21 billion a year prior.

Workers with contracts of one year and above logged personal remittances worth $2.63 billion, up 3.6% year on year, while those with contracts of less thn one year sent home $610 million worth of cash and items, jumping by 3.9% from the previous year.

FIRST HALF
For the first semester, cash remittances from migrant Filipinos went up by 3.1% to $16.75 billion from the $16.25 billion recorded in the comparable year-ago period.

Money sent home by land-based workers rose by 3.3% year on year to $13.38 billion in the six months through June, while sea-based OFWs’ remittances increased by 2.2% to $3.38 billion.

The United States remained as the top source of cash remittances in the first half, accounting for 40.1% of the total.

This was followed by Singapore (7.1%), Saudi Arabia (6.2%), Japan (5%), the United Kingdom (4.9%), the United Arab Emirates (4.3%), Canada (3.3%), Qatar (2.9%), Korea (2.8%) and Taiwan (2.7%).

Meanwhile, personal remittances in the January-to-June period reached $18.67 billion, up by 3.1% from $18.1 billion a year prior.

Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines, Inc., said the increase in cash remittances was “driven by sustained demand for Filipino workers abroad and improved remittance channels.”

“The growth was led by land-based workers, particularly in the Middle East and North America, where labor markets remain robust,” Mr. Asuncion said.

“It reflects continued resilience in global labor markets, especially in the US and Middle East, as well as seasonal boosts tied to school enrollment and mid-year expenses,” John Paolo R. Rivera, a senior research fellow at the Philippine Institute for Development Studies, likewise said.

He added that stronger exchange rates in destination countries may have encouraged overseas Filipinos to send more money back home.

The peso traded at the P55 to P57 levels against the US dollar in June, depreciating sharply mid-month as Israel and Iran exchanged attacks, with the US also joining the conflict later on before a temporary ceasefire was reached. However, the greenback’s strength that month was capped by dovish US Federal Reserve bets.

The BSP expects cash remittances to grow by 2.8% this year. — Katherine K. Chan

E-wallets told to drop gambling links

The Bangko Sentral ng Pilipinas (BSP) on Thursday ordered all electronic wallets (e-wallets), banks and other supervised institutions to remove in-app gambling assets, including any links that direct users to gaming or gambling websites.

“The BSP directive is issued in light of the surge in online gambling transactions and its impact on the financial health of consumers and their families, and considering the broader social cost,” the central bank said in a statement late Thursday.

The BSP said the suspension will remain in place until its guidelines for online gambling payment services are finalized.

BSP Deputy Governor Mamerto E. Tangonan said these financial firms were given 48 hours to remove the links that redirect users to gambling websites.

“The Monetary Board of the BSP has approved our policy ordering BSP-supervised institutions to take down and remove all icons and links redirecting to online gambling sites,” he said during a Senate committee hearing on online gambling.

In separate statements, GCash and Maya said they will comply with the BSP’s directive immediately.

E-wallets such as GCash and Maya have integrated gambling-related services in their apps, making it easy for users to access online casinos. This has helped fuel the popularity of online gambling in recent years.

However, concerns over rising gambling addiction and mounting debt have prompted lawmakers and regulators to consider measures to ban or restrict online gambling in the country.

Senator Alan Peter S. Cayetano questioned why it would take 48 hours to remove the links to online gaming sites when it could be done immediately.

“Why do they need 48 hours? Isn’t that instant? So if someone dies in 48 hours because they are addicted (to online gambling), is that okay?” said Mr. Cayetano, who heads the Senate Committee on Banks and Financial Institutions.

Mr. Tangonan said the 48 hours would be enough time for e-wallet operators to remove all links to online gambling sites.

“The other reason is so that we would give time for the customers to withdraw their funds from the online gaming account, once they learn that we are already removing the links from the mobile payment applications and websites,” he added.

Mr. Tangonan said that the removal of links to online gaming sites is an “immediate measure” as the BSP is still finalizing new rules to mitigate gambling-related harm by strengthening financial safeguards across banks, e-wallets, and payment platforms.

“The suspension of the in-house links from the mobile apps is an immediate measure, while we are finalizing regulations (on online gaming sites),” he said.

Mr. Tangonan said the use of credit cards to pay for online bets will also be prohibited by the BSP.

The BSP also proposed measures such as biometric ID checks, daily transaction limits, time-based payment restrictions, and user tools for spending caps, voluntary breaks, and self-exclusion.

The central bank said these safeguards aim to curb addiction, fraud, and financial harm while encouraging responsible use of digital finance.

E-wallets told to update apps

GCash said they will immediately enforce the changes on its app once it receives the official directive from the BSP.

“We share the BSP’s commitment to ensuring that digital financial services are used responsibly and in ways that protect the welfare of Filipinos,” GCash said.

Maya said the app will be updated in line with the BSP’s guidance.

“We assure customers that their accounts and transactions remain secure and fully operational. We remain focused on serving our customers while fully complying with regulatory requirements,” Maya said.

Senator Erwin T. Tulfo, who chairs the Games and Amusements Committee, warned that he would cite the BSP official in contempt if e-wallets still have links to gaming sites once the 48-hour deadline ends.

“Don’t mess with this committee. We have a problem, we have a crisis. When you say that the deadline is on Saturday, I’ll give you until Sunday. If there are still (gaming links) on e-wallets on Sunday morning, we’ll cite you in contempt,” Mr. Tulfo said.

Sought for comment, Ronald B. Gustilo, national campaigner for Digital Pinoys group, said that the central bank should ensure that all e-wallet platforms comply with its order to remove links to gaming websites.

“Noncompliance should be met with harsh penalties such as suspension or even revocation of license,” Mr. Gustilo said in a Viber message.

“Ultimately, the protection and well-being of each Filipino should be the paramount agenda of any policy or regulation implemented by the government,” he added.

Filomeno S. Sta. Ana III, coordinator of Action for Economic Reforms, said that the BSP should utilize advanced technologies and artificial intelligence (AI) to monitor fraudulent activities linked to online gambling.

“Advanced technologies that monitor activities in real time are available. AI too is a good tool to monitor patterns of fraudulent activities,” Mr. Sta Ana said in a Viber message.

Mr. Tulfo also called on the BSP, the Philippine Amusement and Gaming Corp. (PAGCOR), and other government agencies to create “concise solutions” against online gambling.

“We want a clear and concise solution. We are talking now because majority of us wants total ban on online gambling while you are asking for regulation due to foregone revenues. From the Senate’s end, we are inclined to ban it because social ills outweigh the income benefits,” he added.

President Ferdinand R. Marcos, Jr. has earlier said that a ban may drive people toward illegal gambling platforms. He called for a broad consultation involving various stakeholders before making a decision.

For its part, PAGCOR said that it was still studying if it would impose higher collection rates for licensed gaming operators.

“The PAGCOR is talking to (the Department of Finance) and we are studying the possibility,” PAGCOR Chairman and Chief Executive Officer Alejandro H. Tengco told reporters.

Mr. Tengco, however, warned that imposing higher collection fees could encourage some to operate illegally instead.

“Let’s see if we should raise it a little bit so that it will be more tight, or maybe it will backfire and the illegal (operators) will be more profitable,” he added.

PAGCOR collects a 30% rate from e-gaming platforms. This was earlier slashed from 35% to encourage more illegal gambling operators to register.

According to PAGCOR, the gaming industry’s gross gaming revenues (GGR) jumped by 26% to PHP 214.75 billion in the first half of 2025. This was driven by the electronic games sector which saw a 53.47% increase in gross revenues to PHP 114.83 billion.

PAGCOR expects GGR to surpass PHP 480 billion in 2025. — Adrian H. Halili, Reporter

Q2 foreign investment pledges slide on tariff woes

Foreign investment pledges plunged by 64.4% in the second quarter as investor sentiment turned cautious amid heightened global uncertainty driven by flip-flopping US tariff policies.

Preliminary data from the Philippine Statistics Authority (PSA) showed the value of foreign commitments approved by investment promotion agencies (IPAs) reached PHP 67.38 billion in the April-to-June period, down from the revised PHP 189.5 billion in same period in 2024.

However, this was the highest amount since the PHP 143.74 billion seen in the third quarter of 2024. It was also more than double the revised PHP 27.99 billion in the first three months of 2025.

During the second quarter, Singapore accounted for the bulk or 79.4% of total approved investment pledges at PHP 53.48 billion. This was followed by the United States with PHP 3.96 billion (5.9%) and the Netherlands with PHP 1.91 billion (2.8%).

Cid L. Terosa, a senior economist at the University of Asia and the Pacific, said the decline in foreign investment approvals reflected drastic changes in external trade and investment environments.

“The uncertainty and instability created by Trump’s trade-related pronouncements was the overwhelming factor that pulled back business and investment plans of investors, not just in the Philippines but in many countries around the world,” he said in an e-mail.

However, the quarter-on-quarter increase was mainly due to the surge of investments in renewable energy from Singapore, Mr. Terosa said.

US President Donald J. Trump first announced the “Liberation Day” tariffs in early April, imposing a 10% baseline tariff on goods from all its trading partners. He also threatened higher “reciprocal” tariffs on most countries but this was postponed until July.

The Philippines initially faced a 17% tariff, but this was hiked to 20% in early July. Mr. Trump eventually set a 19% tariff on Philippine goods, which took effect on Aug. 7.

PSA data showed the investment pledges were approved by seven IPAs — the Authority of the Freeport Area of Bataan (AFAB), the Board of Investments (BoI), the Bangsamoro Board of Investments (BBoI), the Clark Development Corp. (CDC), the Clark International Airport Corp. (CIAC), the Philippine Economic Zone Authority (PEZA), and the Subic Bay Metropolitan Authority (SBMA).

The BoI contributed the biggest chunk or about 84.1% of foreign investment pledges with PHP 56.65 billion in the second quarter.

Meanwhile, PEZA approved PHP 6.92 billion worth of commitments (10.3% share) followed by CDC with PHP 1.1 billion (1.6% share).

During the period, Bases Conversion and Development Authority, Cagayan Economic Zone Authority, John Hay Management Corp., Poro Point Management Corp., Tourism Infrastructure and Enterprise Zone Authority, and Zamboanga City Special Economic Zone Authority did not approve any investment pledges.

About 81.2% or PHP 54.75 billion of the approved foreign investments will be poured into the energy industry, while 6.8% or PHP 4.61 billion will be invested in the administrative and support service activities industry.

The manufacturing sector cornered PHP 4.46 billion, about 6.6% of the total pledges.

By region, Bicol received the highest share of total pledged investments, with 47.8% or PHP 32.21 billion. Calabarzon followed with PHP 21.39 billion (31.7% share) and Central Luzon with PHP 4.05 billion (6% share).

Meanwhile, PSA data showed investment pledges from Filipinos plunged by 56.3% to PHP 231.69 billion in the second quarter from the P530.6 billion a year earlier.

This brought total approved investments to PHP 299.08 billion, down 58.5% year on year.

Should these pledges materialize, around 38,234 jobs are expected to be created.

For the third quarter, Mr. Terosa said year-on-year growth in investment pledges will likely be “weaker.”

“(This is) partly because of base effects and the ‘wait-and-see’ attitude of foreign investors due to the turbulent global trade environment,” he said.

“It is possible, however, that the quarter-on-quarter growth of foreign investments will continue to be strong because of the economic resilience shown by the Philippines as reflected in economic indicators.”

In the second quarter, the Philippine economy grew by 5.5%, a tad faster than the 5.4% in the first quarter.

For the first half, gross domestic product (GDP) growth averaged 5.4%, slower than the 6.2% a year ago. The government is targeting 5.5%-6.5% GDP growth this year.

The PSA data on foreign investment commitments, which may materialize shortly, differ from actual foreign direct investments tracked by the BSP. The central bank’s monitoring goes beyond the projects and includes other items such as reinvested earnings and lending to Philippine units via their debt instruments. — Matthew Miguel L. Castillo, Researcher

Vehicle sales slip in July as rains dampen demand

New vehicle sales declined in July, as bad weather disrupted retail operations, a joint report by the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) and Truck Manufacturers Association (TMA) showed.

The CAMPI-TMA report showed new vehicle sales fell by 2.6% to 38,295 units in July from 39,331 units in the same month a year ago.

Month on month, car sales also slipped by 5.4% from 40,483 units sold in June.

CAMPI President Rommel R. Gutierrez attributed the decline in sales to weather-related disruptions, which affected retail operations.

In July, passenger car sales slumped by 25.7% to 8,120 from 10,923 units sold in the same month a year ago.

Month on month, sales jumped by 17.31% from 6,922 units sold in June.

On the other hand, sales of commercial vehicles, which accounted for 78.8% of July sales, increased by 6.2% to 30,175 from 28,408 units a year ago. Month on month, sales declined by 10.1% from 33,561 units in June.

Broken down, sales of light commercial vehicle sales grew by 8% year on year to 22,523 units in July, while sales of Asian utility vehicles (AUV) inched up by 0.7% to 6,664.

Month on month, sales of light commercial vehicles and AUVs dropped 11.7% and 7.4%, respectively.

Sales of light-duty trucks and buses went up by 5.6% year on year to 607 units in July, while sales of medium and large trucks increased by 1% and 21.5% to 302 and 79 units, respectively.

Month on month, sales of light, medium, and heavy trucks increased by 14.1%, 11.4%, and 36.2%, respectively.

CAMPI and TMA expressed confidence the industry will hit its 500,000 full-year sales target, driven by new model launches, promotional campaigns, and improving consumer sentiment.

“The industry’s continued growth, particularly in commercial segments, reflects strong market fundamentals and the agility of our members in navigating short-term challenges,” Mr. Gutierrez said.

“We are optimistic that the momentum will carry forward into the second half of the year,” he added.

Mr. Gutierrez said that the sales momentum is being supported by “strong commercial vehicle demand and signs of recovery in the passenger car segment.”

For the January-to-July period, new vehicle sales increased by 1.4% to 269,207 units from 265,610 units a year ago.

Commercial vehicle sales grew by 10.6% to 215,440 units from 194,812 units in the same period a year ago.

This offset the 24.1% decline in passenger car sales to 53,767 in the first seven months from 70,798 in the same period last year.

Philippine Institute for Development Studies Senior Research Fellow John Paolo R. Rivera said that the increase in commercial vehicle sales reflect the demand shift among customers.

“Businesses and transport operators continue to invest, while consumer purchases are being postponed amid economic uncertainty,” he said in a Viber message.

Mr. Rivera said that the industry’s full-year sales target of 500,000 is achievable, assuming there is continued infrastructure spending and new model launches.

“However, sustained passenger car recovery will require improving affordability, credit terms, and consumer confidence,” he added.

Regina Capital Development Corp. Head of Sales Luis A. Limlingan said that July car sales show that automobiles are no longer at the forefront of consumers’ discretionary spending despite stronger consumption trends.

“While the 500,000-unit target is still within reach, but we still consider various factors, including the potential impact of holiday spending,” he said in a Viber message.

“Notably, despite the uptick in overall consumption compared to last year paired with election spending, vehicle sales have shown a quite muted response,” he added.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said that the latest sales report reflected buyers’ preference for sport utility vehicles and vehicles with higher elevation or clearance in view of the rainy season.

He also said that the July data may have reflected “some frontloading of purchases for pickup trucks before higher tax rates take effect.”

Pickup trucks were previously given special tax treatment under the Tax Reform for Acceleration and Inclusion law.

President Ferdinand R. Marcos, Jr. earlier this year signed into law the Capital Markets Efficiency Promotion Act, which in part reimposes the excise tax on pickup trucks.

Meanwhile, Mr. Ricafort said that electrified vehicles (EVs), including hybrid vehicles, have become an additional source of demand.

“These become more responsive to customer ever-changing requirements and preferences… with better terms and prices,” he added.

According to the report, the industry sold 2,707 EV units in July, down by 11.4% from the 3,057 units sold in June.

For the first seven months, EV sales stood at 16,195 units, accounting for 6.02% of the industry’s total sales.

Toyota Motor Philippines Corp. remained the market leader, with sales of 129,334 units in the January-to-July period, up 5.4% from 122,730 units a year ago. It accounted for 48.04% of the market share.

Mitsubishi Motors Philippines Corp. ranked second with a market share of 19.01% after posting a 1.1% increase in sales to 51,167 units in the first seven months from 50,599 units a year ago.

In third spot was Nissan Philippines, Inc., even as sales dropped by 13.8% to 13,629. It had a market share of 5.06%.

Rounding out the top five were Ford Motor Co. Phils., Inc. which saw a 20.8% drop in sales to 13,323, and Suzuki Phils., Inc., which saw a 9.8% increase in sales to 12,622 units. — Justine Irish D. Tabile, Reporter

Peso weakens vs dollar ahead of US PPI data

The peso weakened against the dollar on Thursday as players repositioned before the release of July US producer inflation data overnight.

The local unit closed at PHP 56.945 per dollar, dropping by 22.5 centavos from its PHP 56.72 finish on Wednesday, Bankers Association of the Philippines data showed.

The peso opened the session a tad stronger at P56.70 against the dollar. It climbed to as high as PHP 56.61, while its worst showing was at PHP 56.995 against the greenback.

Dollars exchanged rose to USD 1.87 billion on Thursday from USD 1.63 billion on Wednesday.

“The dollar-peso initially fell to lows of PHP 56.61 on dovish Fed bets but later reached highs of PHP 56.955 on profit taking and trimming of positions ahead of US PPI (producer price index) data,” a trader said in a phone interview.

The US dollar rose slightly against other major currencies on Thursday, but stayed close to multi-week lows as bets that the Federal Reserve will resume cutting interest rates next month ticked higher, Reuters reported.

Fed rhetoric has turned broadly more dovish on signs of a cooling US labor market, while President Donald J. Trump’s tariffs are yet to add significantly to price pressures.

Traders see a Fed rate cut on Sept. 17 as a near certainty, according to LSEG data, and even lay around 7% odds on a super-sized half-point reduction.

The Fed also continues to be under intense political pressure to ease.

Mr. Trump has repeatedly criticized Fed Chair Jerome H. Powell for not cutting rates sooner, even threatening to oust him before Mr. Powell’s term expires in May.

Treasury Secretary Scott Bessent on Wednesday called for a “series of rate cuts,” and said the Fed could kick off the policy easing with a half-point cut.

Francesco Pesole, FX strategist at ING, said a 50 basis points rate cut is not very realistic right now.

“In order for the market to price 50 basis points in, we would probably need some indication from other Fed members that they are somewhat open to the idea,” he said.

Traders are now looking ahead to US PPI figures for July due later in the session.

“If that comes in soft or below expectations that can add a little bit of easing,” said ING’s Mr. Pesole.

Meanwhile, the peso was also dragged lower by “estimates of higher national government borrowings and outstanding debt for 2026,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

The 2026 Budget of Expenditures and Sources of Financing showed that the National Government’s (NG) outstanding debt is expected to increase by 9.78% to a record PHP 19.06 trillion by end-2026 from the revised PHP 17.36-trillion estimate for end-2025.

As of June, the Philippines’ outstanding debt hit a fresh high of PHP 17.27 trillion, up 11.5% from PHP 15.48 trillion in the same month in 2024.

This brought the debt-to-gross domestic product (GDP) ratio to 63.1% at the end of June, the highest ratio since 2005. This is above the 60% debt-to-GDP threshold considered by multilateral lenders to be manageable for developing economies.

Meanwhile, the NG’s gross borrowing program for 2026 was set at PHP 2.68 trillion, up 3.15% from PHP 2.6 trillion this year.

For Friday, the trader sees the peso moving between PHP 56.70 and PHP 57.10 per dollar, while Mr. Ricafort expects it to range from PHP 56.80 to PHP 57.10. — Aaron Michael C. Sy with Reuters

Stocks go down on profit taking, fiscal concerns

Philippine stocks dropped on Thursday on profit taking after the market’s two-day climb and concerns over the country’s fiscal health.

The Philippine Stock Exchange index (PSEi) fell by 0.52% or 33.24 points to close at 6,291.85, while the broader all shares index sank by 0.57% or 21.61 points to 3,743.03.

“The local market declined as investors took profits following two days of rallying,” Philstocks Financial Inc. Research Manager Japhet Louis O. Tantiangco said in a Viber message.

“Concerns over the outlook of the Philippines’ fiscal position also dampened sentiment as the government’s outstanding debt is projected to hit PHP 19.06 trillion by end-2026,” he added.

Finance Secretary Ralph G. Recto said NG debt is still manageable, noting the economy will be worth roughly PHP 31.8 trillion by 2026.

As of June, the Philippines’ outstanding debt hit a fresh high of PHP 17.27 trillion, up 11.5% from PHP 15.48 trillion in the same month in 2024.

“The market slipped today as some investors may have already taken profits following the index’s series of uptrends this week,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

“Furthermore, investors are likely still waiting for developments in stock market news that could influence the overall market, along with the upcoming implementation of the PSEi rebalancing,” he added. The rebalancing will take effect on Aug. 18.

Sectoral indices ended mixed on Thursday. Services dropped by 2.42% or 56.03 points to 2,259.55; property retreated by 1.02% or 24.97 points to 2,413.58; and holding firms declined by 0.64% or 34.63 points to 5,302.24.

Meanwhile, industrials climbed by 0.38% or 34.23 points to 8,961.63; financials rose by 0.09% or 1.97 points to 2,152.02; and mining and oil edged up by 0.09 point to 9,330.87.

“Jollibee Foods Corp. was the top index gainer, climbing 2.33% to P220. Converge ICT Solutions, Inc. was the main index laggard, plunging 7.46% to PHP 14.88,” Mr. Tantiangco said.

Value turnover went down to PHP 8.41 billion on Thursday with 2.09 billion shares exchanged from the PHP 10.61 billion with 893.55 million shares traded on Wednesday.

Market breadth was negative as decliners outnumbered advancers, 106 to 84, while 46 names were unchanged.

Net foreign buying went down to PHP 100.92 million on Thursday from PHP 973.04 million on Wednesday. — Revin Mikhael D. Ochave

Gov’t debt to breach PHP 19T in 2026

The national government’s (NG) outstanding debt is projected to balloon to a record PHP 19.06 trillion by the end of 2026, a Department of Budget and Management (DBM) document showed on Wednesday.

This as the government is planning to borrow P2.68 trillion next year to fund the national budget.

The 2026 Budget of Expenditures and Sources of Financing showed the NG’s debt stock is expected to increase by 9.78% from the revised PHP 17.36-trillion estimate for end-2025.

Of the total, domestic debt is expected to rise by 10.27% to PHP 13.28 trillion by end-2026 from the projected PHP 12.04 trillion by end-2025.

Outstanding external debt is also seen to jump by 8.67% to PHP 5.78 trillion by end-2026 from PHP 5.31 trillion by end-2025.

Finance Secretary Ralph G. Recto told BusinessWorld the NG debt is still manageable, noting the economy will be roughly worth PHP 31.8 trillion by 2026.

As of June, the Philippines’ sovereign debt hit a fresh high of PHP 17.27 trillion, up 11.5% from PHP 15.48 trillion in the same month in 2024.

“It’s still consistent with our MTFF (Medium Term Fiscal Framework). But we want it at least 60%, that’s the international standard,

Budget Secretary Amenah F. Pangandaman told reporters on the sidelines of the 2026 National Expenditure Program turnover in the House of Representatives.

“Hopefully, we get to that or if possible, even lower around 59% or 58%,” Ms. Pangandaman said.

The DBM said it now expects the debt-to-GDP ratio to settle at 61.3% by end-2025, slightly higher than the previous target of 60.4%.

By end-2026, the debt-to-GDP ratio is seen to pick up to 61.8%.

Budget Assistant Secretary Romeo Matthew T. Balanquit said the higher projections for the debt-to-GDP ratio factored in expectations of slower economic growth.

Economic managers in June narrowed the GDP growth target range to 5.5-6.5% this year from the previous target of 6-8%, “reflecting a more measured and resilient outlook amid global headwinds.”

The growth target was also trimmed to 6-7% for 2026 to 2028 from 6-8% previously.

Mr. Balanquit said the massive debt was accumulated by the government during the coronavirus disease 2019 (COVID-19) pandemic.

“We are paying our debts during the pandemic times. We really need to step up our interest payments. But the good thing here is, interest rates are actually going down,” he said.

“We will also see that the cost of borrowing will be lower over the next few years. Admittedly, our interest payments are increasing,” he added.

Borrowing program

Meanwhile, the government’s borrowing program for 2026 was set at PHP 2.68 trillion, up 3.15% from PHP 2.6 trillion this year.

Mr. Balanquit said the borrowing mix remains at a 80:20 ratio in favor of domestic sources to minimize risks from external shocks.

Gross domestic borrowings were set at P2.05 trillion for 2026, 2.7% higher than the PHP 2.11-trillion program in 2025. This includes PHP 1.99 trillion in fixed-rate Treasury bonds and P60 billion in Treasury bills.

On the other hand, gross external borrowings were set at PHP 627.1 billion for next year, 28.46% higher than PHP 488.17 billion this year.

This includes PHP 302.100 billion in bonds and other inflows, PHP 263.29 billion in program loans, PHP 61.71 billion in project loans.

At the same time, the debt service bill is set at PHP 2.01 trillion in 2026, down 2.36% from PHP 2.05 trillion this year.

The government said it will spend PHP 1.06 trillion for principal amortization next year, 12.48% lower than PHP 1.21 trillion in 2025.

For interest payments, the government allocated PHP 950 billion, down by 12% from PHP 848 billion this year.

Tax revenues

For 2026, the NG aims to collect PHP 4.98 trillion in revenues, 10.24% higher than the PHP 4.52-trillion projected collection this year.

The government expects to collect PHP 4.63 trillion in tax revenues next year, a 9.96% increase from its PHP 4.21-trillion projection this year.

The Bureau of Internal Revenue is expected to collect PHP 3.58 trillion, while the Bureau of Customs is seen to generate PHP 1.01 trillion.

On the other hand, nontax revenues are expected to fall by 17.38% to PHP 249.1 billion next year from PHP 301.5 billion this year.

Proceeds from the government’s privatization program are expected to surge to PHP 101 billion in 2026 from PHP 5 billion this year. — Aubrey Rose A. Inosante, Reporter

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