Peso sinks to new record low of P63.615 vs dollar

MANILA — The Philippine peso sank to a new record low of P63.615 against the dollar on October 23, Friday. 

The previous record was P63.52 on October 22.

During intraday trading on Friday, the peso reached a low of P63.62 against the dollar before clawing back to P63.615 at close.

A weaker peso is expected to make oil purchases even more expensive as the commodity is purchased with dollars. It is also expected to stoke inflation. 

The depreciation is also expected to impact the country’s sovereign debt, of which a third is owed to foreign creditors.

A stronger dollar may initially benefit families of overseas Filipino workers, as they can get more pesos for every dollar sent. But inflation may also eat into their purchasing power.

Bangko Sentral Governor Eli Remolona, however, said the bank is not hiking the policy rate to defend the peso, after the BSP raised interest rates to 5.5 percent amid heightened inflation risks.

“We don’t defend the level…so we let the market determine that, and hopefully the market gets it right over the long term,” he said.

“We don’t use up, we kind of come in without using up too much of our reserves, and and we we end up we end up just dampening the swing in the peso. We don’t end up preventing the peso from depreciating,” he said.