Peso hits new all-time low P59.46:$1 amid BSP rate cut speculations

The Philippine peso nosedived to a new all-time low against the US dollar on Thursday amid anticipation of another round of interest rate cut by the Bangko Sentral ng Pilipinas (BSP) in its February meeting.

The local currency shed two centavos to close at P59.46:$1, surpassing the previous historic low of P59.44:$1 seen on Wednesday. 

In a commentary, Rizal Commercial Banking Corp. chief economist Michael Ricafort said the peso’s weakness resulted from the market’s anticipation of a possible 25 basis-point cut by the BSP.

Ricafort added that the peso staying at “59 levels” for more than two-and-a-half months already, or since the latter part of October 2025, "could signal forex intervention to smoothen any volatility.”

On the dollar’s strength, the economist said that the greenback hovered above a one-month high against the Japanese yen “on speculation that Japanese Prime Minister Takaichi could call a snap election.”

Ricafort added that an offsetting positive factor for the peso was the continued net foreign buying continued at the local stock market for all 10 trading days of 2026.

“Important market leads/catalyst for 2026: If anti-corruption measures/reform and policy priority of further improvement in governance standards are taken seriously, as these remain the missing link to boost confidence by investors on the economy and financial markets; future BSP rate cut/s function of future Fed rate cuts to maintain healthy interest rate differentials, stability of the peso exchange rate, benign inflation,” he said.

“Other offsetting positive factors for the peso: Some progress on judicial process related to the anomalous/controversial flood-control infrastructure projects in terms of arrests, cases filed, assets freeze, among other actions taken by local authorities; all part of the policy priority on anti-corruption measures and other reforms to further improve governance standards that would guide catch up government spending to make up for the soft patch in the latter part of 2025,” he added.  –NB, GMA Integrated News