Peso dragged by uncertainties at House of Representatives

The Philippine peso retreated against its US counterpart on Monday, dragged by uncertainties brought about by the squabble at the House of Representatives.

The local currency lost 16.5 centavos to close at P48.47:$1 versus last Friday's finish of P48.305:$1.

Monday's depreciation comes amid speakership issues at the lower house, proving to be a challenge for Congress to pass the 2021 national budget on time.

"The peso exchange rate closed weaker... partly amid uncertainties related to any challenges in the House Speakership position and also on the timely approval/passage of the 2021 national budget, which is needed to increase government spending on infrastructure and other COVID-19 programs, all needed for the economic recovery," Michael Ricafort, chief economist at the Rizal Commercial Banking Corp. (RCBC), said in a mobile message.

Earlier on Monday, allies of Marinduque Representative Lord Allan Velasco "elected" him as Speaker of the House of Representatives, in a session described by the camp of Speaker Alan Peter Cayetano as illegal.

To recall, Cayetano entered in a "gentleman's agreement" with Velasco on term-sharing -- the former for the first 15 months, and the latter would take the seat for the next 21 months.

However, Cayetano said it was unlikely that Velasco would be elected as Speaker, and might only be ousted after a week if Cayetano steps down.

President Rodrigo Duterte on Friday stepped in and called for a special session of Congress to ensure the timely passage of the 2021 national budget.

"The peso was slightly weaker vs. the US dollar but nevertheless still among the strongest in nearly four years, as the markets await the progress on the 2021 national budget with special Congressional sessions scheduled this week to ensure the timely passage of the 2021 national budget amid changes in the House Speaker position," said Ricafort. — BM, GMA News