RECORD LOW: Peso breaches ₱63-per-dollar mark

Rising US inflation and expectations of prolonged high interest rates pushed the Philippine peso to a record low as the currency fell to a record low ₱63 against the United States (US) dollar for the first time onOctober 15.

Data from the Bankers Association of the Philippines showed that the peso had weakened to ₱63.15 per dollar during intraday trading, surpassing its previous record low of ₱62.925 set on September 15.

“The peso’s latest weakness reflects a combination of persistent dollar strength and rising external price pressures,” UnionBank of the Philippines chief economist Ruben Carlo Asuncion said.

Asuncion also cited elevated US Treasury yields and oil prices above $100 per barrel as factors contributing to the peso’s weakness.

According to Reuters, US consumer inflation reached 3.7% in September, exceeding forecasts and renewing expectations that the Federal Reserve could raise interest rates.

The Bangko Sentral ng Pilipinas (BSP) raised its benchmark interest rate to 5% in August, marking the third increase in the current tightening cycle.

BSP Governor Eli Remolona Jr. has said the bank does not target a specific exchange rate but may intervene to limit excessive peso volatility.

The BSP is scheduled to announce its next monetary policy decision on October 22.