Peso hits 4th straight record low at P62.565 against US dollar

The Philippine peso depreciated against the US dollar for the fourth consecutive trading day on Wednesday, hitting a fresh record low as global oil prices climbed amid the conflict between the United States and Iran.

The local currency shed 14 centavos to close at P62.565:$1, surpassing its previous record low of P62.40:$1 set on Tuesday, September 1. Wednesday’s decline marked the peso’s fourth consecutive record-low close.

“The US dollar/peso exchange rate went up… after the latest increase in global crude oil prices with the recent US-Iran retaliatory attacks; higher global oil prices partly led to higher US Treasury yields, among 19-year highs,” Rizal Commercial Banking Corp. (RCBC) chief economist Michael Ricafort said in a mobile message.

The peso's latest decline came as oil prices breached $95 per barrel after the US launched fresh strikes on Iran. Brent crude prices also reached $91 per barrel, among the highest levels in a month since the end of July.

“It is worth noting that the peso exchange rate was relatively stable vs. the US dollar recently amid possible intervention/smoothening of market volatility at 61.60-62.60 levels/range highs recently,” Ricafort said.

Local equities also weakened on Wednesday, with the benchmark Philippine Stock Exchange index (PSEi) falling 40.66 points, or 0.67%, to 6,053.23. The broader All Shares index declined 10.58 points, or 0.31%, to 3,352.61.

Nearly all sectoral indices declined, led by services, which fell 1.46%. Financials dropped 0.41%, holding firms 0.29%, property 0.34%, and mining and oil 0.16%. The industrial index was the sole gainer, rising 0.38%.

More than 610.462 million shares worth P5.693 billion changed hands. Decliners led advancers, 101 to 79, while 65 issues were unchanged.

“The local index closed lower as the market underwent a correction following yesterday’s strong buying activity. Weakness was further driven by the continued depreciation of the peso, which weighed on investor sentiment,” Regina Capital Development Corp. head of sales Luis Limlingan said in a separate message.

“Meanwhile, softer global markets added to the cautious tone, prompting investors to take a more defensive stance,” he added. — VBL, GMA News