BSP's Remolona points to boosting exports, Pax Silica to support PH peso

Bangko Sentral ng Pilipinas (BSP) Governor Eli Remolona Jr. on Thursday said the Philippines must boost its exports to keep the peso from sinking further against the US dollar.

At a hearing of the Senate finance committee, Remolona said that a weak peso causes the cost of imported goods to go up, putting pressure on the cost of goods and services.

“If the peso weakens very sharply mas malakas ang impact ng exchange rate sa inflation. Pero kung mabagal ang galaw hindi masyado ang tinatamaan ang inflation so what we do is we manage the sharp movements in the exchange rate,” the BSP chief said.

(If the peso weakens very sharply, the impact of the exchange rate on inflation increases. But if the peso's movement is slow, it doesn't affect the inflation as much.)

The local currency sank to a fresh historic low against the US dollar at P61.888:$1, shedding 23.8 centavos from the previous finish of P61.65:$1 on Wednesday and surpassing the previous weakest closing of P61.847:41 on July 24, 2026.

Remolona said that the exchange rate “is something very hard to fix for a country like the Philippines,” as the country is import-dependent.

“As you know, we have a trade deficit that’s about 13% of our GDP [gross domestic product]. Kulang na kulang ang exports natin so mahirap pigilan ‘yung pagbaba ng peso. Pwedeng pigilin para bumagal pero ‘di kayang i-fix… at P60 [versus dollar] mauubusan tayo ng reserves,” the central bank chief said.

“Sana lumakas ang exports natin, kulang na kulang eh,” he said.

(Or exports are lacking so it's hard to stop the peso's slide. We can stop the fall but we can't fix it; and at P60 [to the dollar] we might run out of reserves.)

The BSP chief said the government must turn its focus on boosting exports as this could provide support for the local currency.

“Halimbawa yung Pax Silica, maaring makatulong sa exports ‘yan, pati ang Luzon Economic Corridor,” Remolona said.

Pax Silica is the US Department of State's controversial flagship initiative on artificial intelligence and supply chain security, aimed at advancing a new economic security framework among allies and trusted partners.

EXPLAINER: What is Pax Silica and why are people worried?

The Philippines in April officially joined the Pax Silica initiative, cementing its place among other 23 global signatories, including the European Union, Japan, India, Singapore, South Korea, and the United Kingdom.

As part of the initiative, Manila and Washington are working to establish a 4,000-acre industrial hub that is envisioned as a new model for AI-focused investment within the Luzon Economic Corridor.

Amid public outcry—including from the area's indigenous communities—about the prospect of data centers being built as part of the Pax Silica project, the Bases Conversion and Development Authority said that it is not envisioned as a cluster of hyperscale data centers but as an industrial hub that would include the manufacturing of semiconductors and microchips used in computers, laptops, electric vehicles, and other technologies. — BM, GMA News