Peso dives to record low against dollar at P60.69:$1 amid global oil price surge

The Philippine peso continued its losing streak against the US dollar to hit a new all-time low on Monday, as global oil prices climbed even further over the escalating conflict between Iran and the United States in the Middle East.

The peso shed 14 centavos to close at P60.69:$1 from last Friday’s finish of P60.55:$1, the previous record low.

“Peso weakness is still USD strength plus oil demand, with thin liquidity exaggerating moves,” a trader said in a mobile message.

“Sixty-one is possible, but not a straight line — market is stretched. Expect choppy trading around 60-61, not a clean breakout,” the trader added.

Iran, which has closed off the Strait of Hormuz, over the weekend said it was ready to respond should the United States deploy its troops after it accused Washington of planning to send in its ground forces while pushing for negotiations to end the conflict.

US President Donald Trump, for his part, in an interview with Financial Times, said he wants to “take the oil in Iran” and hinted at the possibility of taking over the export hub of Kharg Island, as reported by Reuters.

BSP governor Eli Remolona Jr. last week said the foreign exchange market has not merited heavy intervention so far, as he maintained that the central bank does not target a specific level but instead moves when big swings are made.

“At the same time, we understand that the weakness of the peso is not necessarily a bad thing. The peso, where it’s going, seems to help with our current account deficit and our exports. It’s not necessarily a bad thing,” Remolona said.

Local equities also ended on the red on Monday, with the local stock barometer PSEi down 103.34 points or 1.73% to 5,869.49. The broader All Shares index declined by 40.01 points or 1.20% to 3,295.85.

“The Philippine market opened the week lower as the Middle East war entered its fifth week, the conflict continued to escalate despite ongoing efforts to reach a diplomatic resolution,” Regina Capital Development Corp. head of sales Luis Limlingan said in a mobile message.

“The prolonged tensions have continued to weigh on market risk appetite, as both geopolitical and economic factors persistently dampen investor sentiment,” he added. 

All sectoral indices posted daily declines, except for services, which posted a slight uptick as it gained 0.83 points or 0.03% to close at 2,719.12.

More than 746.280 million shares, valued at P8.292 billion, changed hands. Decliners led advancers, 126 to 74, while 60 shares were unchanged. —NB, GMA Integrated News