Peso drops to historic low anew, closes at 61.75 per US dollar

MANILA, Philippines, May 19 ------ The Philippine peso tumbled to a fresh all-time low on Monday, May 18, closing at 61.75 against the US dollar.

Data from the Bankers Association of the Philippines (BAP) showed the peso opened the trading session at 61.69 and weakened steadily throughout the day, hitting an intraday low of 61.64 before settling at its closing price of 61.75 — six centavos weaker than its previous close of 61.721 on May 15.

The closing rate is now the peso's weakest on record. It also extends a punishing run that has seen the peso repeatedly breach historic lows since late April, when it first crossed the 61-per-dollar mark. Continued tensions in the Middle East despite peace talks have kept global oil prices elevated and stoked demand for the US dollar as a safe haven.

Joint military strikes by the United States and Israel on Iran in late February drew fierce retaliation and prompted a pause in transit across the Strait of Hormuz, a waterway that handles about a fifth of global oil flows. The Philippines sources the bulk of its crude from the Middle East.

SM Investments Corp. group economist Robert Dan Roces earlier said "the move above 61 does not mean the BSP hike failed. It helped, but stronger forces are at work. US rates are still high, the dollar is strong and money is moving out of emerging markets."

The Bangko Sentral ng Pilipinas (BSP) raised its benchmark rate by 25 basis points to 4.5 percent in mid-April, its first hike in more than two years, citing worsening inflation expectations from the global oil shock. BSP Governor Eli Remolona has signaled the central bank remains open to further tightening.

Source: philstar.com