Peso sinks to new all-time low of P61.888 to US dollar

August 28 ------ The Philippine peso depreciated to a new record low against the US dollar on Thursday, following higher inflation estimates from the Bangko Sentral ng Pilipinas (BSP) due to the risks of El Niño and the prospect of minimum wage hikes.

The local currency shed 23.8 centavos to close at P61.888:$1 from Wednesday’s finish of P61.65:$1. This is the weakest it has closed since closing at P61.847:$1 on July 24, 2026. “The peso remains under pressure from a strong dollar, elevated oil prices, and lingering geopolitical risks,” a trader said in a mobile statement. “The BSP hike provides some support, but with much of it already priced in, the peso will still take its cue from global risk sentiment and oil,” the trader added.

This was mirrored by Rizal Commercial Banking Corp, (RCBC) chief economist Michael Ricafort, who cited the upward revisions in the BSP’s inflation forecasts. “The US dollar/peso exchange rate went up for the third day in four trading days… after higher BSP inflation estimates for 2027 and 2028,” he said in a mobile message.

The BSP, in particular, said that it is expecting inflation to be at 5.4% in 2027, from its previous projection of 4.5%, and 3.3% in 2028, from earlier estimate of 3.1% as the impact of El Niño will be more pronounced in the fourth quarter.

The central bank also cited potential wage adjustments as warranting close monitoring, including their implications for broader price setting and second-round effects, saying these risks “require preemptive monetary action.”

Source: gmanetwork.com