Peso slides to new low on dollar’s strength

The peso  closed at a new all-time low on Monday as safe-haven demand due to geopolitical risks kept the dollar strong.

The currency slid by 10.5 centavos to end at a new record low of PHP 63.09 versus the greenback from its PHP 62.985 finish on Friday, Bankers Association of the Philippines data showed. This surpassed the previous all-time-low close of PHP 63.06 on Oct. 15.

Year to date, the peso has depreciated by PHP 4.3 or 6.82% from its PHP 58.79 finish on Dec. 29, 2025.

The local unit opened Monday’s session slightly stronger at PHP 62.98 per dollar, which was already its intraday best. Its worst showing was at PHP 63.17.

Dollars traded rose to USD 1.778 billion from USD 1.598 billion.

“The peso was broadly stable despite renewed US dollar strength,” China Banking Corp. Chief Economist Domini S. Velasquez said. “The dollar strengthened against the yen, pound, and euro, with the two also pressured by domestic concerns.”

She said the peso’s relative stability shows that recent weakness has been driven more by the dollar’s strength and external factors rather than domestic sentiment.

Elevated global crude oil prices also drove dollar demand, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said.

Reyes Tacandong & Co. Senior Adviser Jonathan L. Ravelas added that the peso was weaker ahead of the Bangko Sentral ng Pilipinas’ (BSP) policy meeting on Thursday.

The BSP is expected to deliver a fourth straight 25-basis-point hike this week, according to 20 of 22 economists in a BusinessWorld poll.

Looking ahead, the peso will likely continue to weaken, but easing oil prices and improving global financial conditions may support the currency, Philippine Institute for Development Studies Senior Research Fellow John Paolo R. Rivera said.

“The greater concern is not another record low itself but prolonged depreciation that translates into higher inflation and weaker household purchasing power,” he added.

A trader likewise said that peso weakness will remain a recurring theme given the Philippines’ structural trade deficit, elevated US Treasury yields, and expectations of further tightening by the US Federal Reserve.

“Persistent peso weakness could therefore put additional pressure on the BSP to tighten monetary policy, particularly if inflation expectations begin to rise,” the trader said.

Mr. Ricafort sees the peso moving between PHP 63 and PHP 63.20 on Tuesday.

Meanwhile, Mr. Ravelas expects the currency to range from PHP 62.95 to PHP 63.30 against the dollar in the near term. — Aaron Michael C. Sy