Peso depreciates to new low of P59.44 to US dollar

MANILA, January 15 ------ The Philippine peso depreciated to a historic low of P59.44 against the US dollar at the end of trading. The local currency started the day's trading at an already weak position of P59.38, which was already weaker than the previous all-time low of P59.355, before depreciating further during the day.

Remittances from overseas Filipinos helped the peso regain footing towards the end of 2025, keeping the local currency in the P58-to-the-dollar range. But following the holiday influx of overseas dollars, the peso has again been losing ground. Analysts have pointed out before that a weak peso is a boon for families of overseas Filipino workers, as they stand to gain more pesos from the dollars sent home by their loved ones.

Exporters and BPOs also stand to benefit as it makes exports and BPO services cheaper and more competitive. A weak peso, however, also makes imports like oil and machinery more expensive. It also affects the country's debt, as dollar-denominated borrowings become more expensive in peso terms.

Fan Cheuk Wan, the chief investment officer of Asia of HSBC Private Bank and Premier Wealth, said the peso will likely stay volatile in the near term as the Bangko Sentral ng Pilipinas is expected to implement another 25-basis point rate cut in the first quarter. "So this will bring the Philippine policy rate further down to 4.25 percent and further narrow the interest rate differential between the US and the Philippines," Fan said in an interview with ANC. Meanwhile, the US Federal Reserve is not expected to implement a rate cut in its next meeting this January. "But looking forward, we think the peso has already priced in the growth headwinds and also the central bank policy easing, the factor has been largely priced in," Fan said.

An analyst, earlier also downplayed concerns that the weak peso will hurt the economy, noting that businesses have already factored in an exchange rate of up to P60 to the dollar in their plans for the year.

Source: news.abs-cbn.com