The peso weakened further on Tuesday, falling to a new near 11-year low of P51.34 to the dollar.
The currency opened lower at P51.20, hitting as much as P51.35 during the day. Tuesday’s close was the weakest since the P51.38:$1 recorded on August 25, 2006.
The decline came as the Bangko Sentral ng Pilipinas reported a 6.2 percent increase in money sent home by overseas Filipino workers to $2.75 billion.
“The number looks solid considering that the Qatar sanctions began that month. This should ease keep the current account balance even more manageable and make the market worry less that the peso is on a free fall,” Bank of the Philippine Islands Vice President and lead economist Emilio Neri Jr.
“We reiterate our support to Governor Espenilla’s view that the peso’s depreciation is manageable and will not cause significant inflationary expectations and that preserving our foreign reserves for bigger current account deficits in the future is a bigger priority,” he added.
On Sunday, central bank Governor Nestor Espenilla Jr. sought to assuage concerns over the peso, saying: “It’s natural for it to show volatility as it adjusts to market conditions and all the short-term uncertainties such increased tension in North Korea.”
At the House of Representatives, meanwhile, ACTS OFW Party-list Represetative Aniceto Bertiz 3rd called on regulators to mitigate the impact of a weaker peso on prices of basic services.
In a statement, Bertiz said foreign currency adjustment charges should be spread out, phased-in, or staggered to cushion the impact of the decline of the peso versus the US dollar.
“I am reminding the various public utilities regulatory agencies to keep the economic hardships of the poor and the middle class in mind when they consider over the next weeks and months, the impact of the depreciation of the Philippine peso vis-a-vis the US dollar on rate charges on electricity, water, transport fares, irrigation, and other utilities,” he said
Still, Bertiz noted that the “BSP is not at all worried about the peso depreciation … because it has ascertained that Philippine economy is strong and sound. I am confident the BSP will intervene in the foreign exchange market whenever there are wild fluctuations, steep changes, or radical shifts.”