Peso stays at P61.75 to dollar for second straight day, weakest level

MANILA, July 24 ------ The Philippine peso again stayed at its weakest level of P61.75 to the US dollar at the end of Thursday’s trading.

Data from the Bankers Association of the Philippines showed the local currency starting Wednesday’s trading at P61.74, and further slid to an intraday low of P61.75, which was also its closing level. This is the third time that the local currency has hit this level, which is its weakest so far in history.

A weakening Philippine peso coupled with surging global oil prices poses a "double whammy" threat to the domestic economy, threatening to drive up local inflation and deter foreign investors, an analyst said on Thursday. Japhet Tantiangco, Research Manager at Philstocks Financial, warned that the local currency's depreciation directly elevates import costs at a time when the Philippines is becoming increasingly dependent on foreign goods.

The pressure is particularly severe in the energy sector, where global crude prices are rising amid ongoing tensions in the Middle East, he said. "We already have rising global oil prices, and then you have a depreciating currency," Tantiangco said, highlighting how the twin pressures inevitably feed into higher prices at home.

Beyond driving consumer prices higher, a weakening currency risks undermining confidence among foreign investors, potentially prompting them to pull back from the local market. Overall, the combination of currency depreciation and rising commodity costs presents a challenging backdrop for the country's financial outlook.

Source: inquirer.net