Peso carves fresh record low, PSEi slumps as Middle East conflict drags on

Philippine financial markets continued to bleed on Monday, as global oil prices breached $100 per barrel due to the intensified conflict in the Middle East, spurring inflation concerns which could lead to monetary policy tightening.

The Philippine peso shed 50 centavos to close at P59.5:$1 versus last Friday’s finish of P59:$1, after hitting a record intraday low of P59.7:$1 earlier in the session. Monday’s close is the worst showing on record, surpassing the previous low of P59.46:$1 on January 15, 2026.

“Main factor was global oil prices $100 per barrel,” Security Bank chief economist Angelo Taningco said in a mobile message, as international benchmark Brent crude climbed 30% to hit $119 per barrel or the highest since July 2022.

Locally, double-digit pump price hikes are expected this week—gasoline by P7.00 to P13.00 per liter, diesel by P17.50 to P24.25 per liter, and kerosene by P32.00 to P38.50 per liter. The Department of Energy (DOE) has since appealed for firms to stagger the implementation of hikes starting this week.

The DOE earlier said prices could be hiked further due to global developments such as the closure of the Strait of Hormuz, a key global shipping corridor, amid the armed conflict among the United States, Israel, and Iran.

Just last week Bangko Sentral ng Pilipinas (BSP) governor Eli Remolona Jr. signaled a possible rate hike should global crude oil prices breach $100 per barrel, in a bid to tame inflation.

“[This] could reduce the odds of future Fed rate cuts at the very least or could even lead to potential BSP rate hike/s to fulfill its price stability/stable inflation mandate,” Rizal Commercial Banking Corp. chief economist Michael Ricafort said in a separate mobile message.

“Inflation and inflation expectations could pick up after possible large increases in local fuel pump prices, especially risk of second-round inflation effects or supply-side inflation pressures if the war on Iran drags on,” he added.

PSEi

The local stock barometer the Philippine Stock Exchange index (PSEi) lost 314.19 points or 4.97% to 6,006.22 at the closing bell, while the broader All Shares index declined by 148.24 points or 4.24% to 3,346.75.

All indices closed on the red, with the biggest decrement seen in holdings firms which fell by 5.94%, followed by property by 5.12%, financials and mining and oil by 4.77% each, services by 4.28%, and industrial by 4.01%.

“The Philippine market declined sharply amid escalating tensions in the Middle East, which dampened investor sentiment and risk appetite across global markets,” Regina Capital Development Corp. head of sales Luis Limlingan said in a separate mobile message.

More than 2.538 billion shares, valued at P11.082 billion, changed hands. Decliners led advancers, 205 to 28, while 41 issues were unchanged. — BM, GMA Integrated News