The peso slipped briefly to the P44:$1 level Friday morning, causing some jitters, before rising back to the P43:$1 level at the end of the trading day.
Importers, in particular, were worried that the fall of the local currency would continue without the intervention of the central bank. But this proved to be unnecessary.
The “weakening” of the Philippine peso is not necessarily a bad thing, as any economist knows. For one, the remittances of the millions of overseas Filipino workers (OFWs) to their families in the country will result in greater spending power for them.
Exporters will also be glad at the higher exchange rate because they will receive more pesos for the dollars that they earn.
Such windfalls will result in heightened spending, which will further boost the Philippine economy that is already growing at a healthy pace.
Depending on how one looks at it, therefore, the upward or downward movement of the peso can appear to be an ominous sign of things to come.
In fact, the best thing to happen to the country’s currency is to allow it to seek its own level. Pushing or pulling it to move one way or the other will usually result in negative consequences. The country can better compete in the global stage if its currency has not been artificially pegged at unrealistic levels.
Whether the peso moves further north to the 45 or even 50 to the greenback level, or heads back south to the P41:$1 level, where it had stabilized for some time, there should be no ill-effects that Filipino consumers will not be able to handle.
For as long as there are no shocks caused by abrupt rises or falls of the peso, there should be nothing to worry about.
The Bangko Sentral ng Pilipinas has the situation under control, and exporters, importers, the business community, and the families of OFWs will just have to watch for further developments, and either tighten or loosen their purse strings depending on which way the wind blows.