20.04.202602:05:50UTC+00Philippine Peso Falls Back Toward Record Low

The Philippine peso weakened to around PHP 60 per USD, approaching the record low reached on March 30, as escalating US-Iran tensions and renewed disruptions in the Strait of Hormuz unsettled markets. The fragile ceasefire in the Iran conflict came under renewed pressure after the United States seized an Iranian cargo ship in the Gulf of Oman, prompting Tehran’s top military leadership to threaten retaliation and reaffirm its intention to assert control over the strategic waterway.

The protracted conflict has fueled higher inflation, sub-target economic growth, a wider current account deficit, and increased risks to remittance inflows in the Philippines. In response, the Bangko Sentral ng Pilipinas has urged banks to be more proactive in encouraging corporates to hedge their foreign exchange exposure, highlighting how the Iran conflict has exposed the country’s vulnerability to geopolitical shocks. The central bank emphasized that its main priority is to ensure the smooth functioning of domestic financial markets, so that capital continues to flow even amid oil price spikes, peso depreciation, and heightened volatility in global yields.