Philippine peso hits new record low against US dollar

The Philippine peso weakened to a new record low on Tuesday, closing at 62.625 against the US dollar, a drop of 3.9 centavos from the previous day. This decline came despite the dollar index being subdued, with the Japanese yen gaining ground. Investors are positioning themselves ahead of US inflation data due later this week, with a 60-percent chance of a Federal Reserve rate hike this month. The Bangko Sentral ng Pilipinas raised its benchmark rate last month to 5 percent, but the peso remains weak, trading beyond the 60-to-62 range expected by the Marcos administration for the year. Structural pressures, including higher energy prices, are contributing to the currency's weakness.

Economists suggest that while the peso's trading range remains relatively narrow, selling pressure could intensify if the dollar stays strong and energy prices remain elevated. However, the central bank is expected to manage excessive volatility with its policy tools and reserves.

Read the full story at business.inquirer.net.