THE PHILIPPINE peso fell to a new record low on Wednesday, November 12, as investor confidence continued to be rattled by a widening corruption scandal at home that has already taken a toll on economic growth.
The local currency weakened by 18.5 centavos from the previous day to close at 59.17 against the dollar, surpassing the previous record low of 59.13 set on Oct. 28. Trading volume was heavy, rising to $1.7 billion from $1.47 billion in the prior session.
“Locally, market confidence is being tested by governance issues and slower growth, which make investors more cautious,” John Paolo Rivera, a senior research fellow at the state-run Philippine Institute for Development Studies, said.
Offshore, a trader said the dollar showed only modest softness after the US Senate approved a measure to reopen the federal government, ending a 40-day shutdown.
“However, the 60-peso level remains a psychological level for many domestic participants wherein the BSP (Bangko Sentral ng Pilipinas) might be compelled to intervene to prevent local inflation expectations getting unanchored,” the trader said.
Another trader said a break toward 60-level “looks entirely plausible” if global risk sentiment sours or if policy surprises stateside push the dollar higher.
In a commentary, GlobalSource Partners analyst Diwa Guinigundo said a “measured” pause in local interest rate cuts could help steady market confidence and preserve macroeconomic credibility. While further easing could support growth, he warned, it also risks fueling capital outflows that could add pressure on the fragile peso.
“In this environment, a measured pause in policy rates could send a constructive signal — that the BSP remains data-driven, vigilant, and risk-conscious,” Guinigundo added. (Ian Nicolas P. Cigaral © Philippine Daily Inquirer)
