24.04.202603:15:27UTC+00Philippine Peso Weakens Toward Record Low

The Philippine peso weakened beyond 60.7 per USD, trading close to its record low as broad dollar strength and risk-off sentiment continued to weigh on Asian currencies. Escalating tensions in the Middle East — including renewed disruptions in the Strait of Hormuz following vessel seizures and intensified US naval warnings — kept oil prices elevated. Higher crude prices raise inflation risks for import-dependent economies such as the Philippines, widening the external payments burden and bolstering demand for the US dollar. At the same time, safe-haven flows into the greenback remained strong amid persistent uncertainty over the US–Iran standoff.

Domestic policy provided only a partial counterbalance. The Bangko Sentral ng Pilipinas raised its benchmark rate by 25 basis points to 4.5%, its first hike in more than two years, citing a deteriorating inflation outlook driven by higher global oil and food prices. BSP Governor Eli Remolona also indicated that further tightening remains on the table if needed, underscoring a more proactive policy stance.