Peso plunges to fresh record low as PSEi extends recovery

The peso plunged 27.1 centavos, or 0.43 percent, to a record low of P63.361 per US dollar on Wednesday, even as the Philippine Stock Exchange Index (PSEi) rose 15.34 points, or 0.26 percent, to 5,821.51, buoyed by foreign buying and gains in heavyweight shares.

The peso’s decline extended its slide beyond the P63-per-dollar threshold amid persistent dollar strength, elevated global oil prices and geopolitical uncertainty. The currency has continued to weaken after closing at record lows of P63.09 on Monday and Friday last week.

The peso also hit a fresh intraday low of P63.373 per dollar, surpassing the previous record of P63.23 set last Friday.

Market observers have pointed to external payments pressures and demand for foreign currency as factors weighing on the peso. The Bangko Sentral ng Pilipinas reported a $3.1-billion balance-of-payments deficit in September, adding to concerns over the country’s external position.

Rising oil prices added to the pressure. Brent crude climbed 1.5 percent to $110.40 a barrel on Wednesday, while US West Texas Intermediate crude rose 1.5 percent to $99.27 as renewed Middle East supply concerns and falling US inventories supported prices. Higher oil prices raise import costs for the Philippines, a net energy importer, and can increase domestic demand for dollars.

The peso opened at P63.01 and traded between P63.00 and P63.373 before closing at P63.361. The Bankers Association of the Philippines’ morning weighted average was P63.17, while the afternoon average rose to P63.278, indicating further peso weakness during afternoon trading. The full-day weighted average stood at P63.226, while the foreign exchange settlement rate was P63.17.

Spot-market volume reached $1.3413 billion, slightly below Tuesday’s $1.3598 billion.

Despite the peso’s record low, the PSEi extended its recovery, although market breadth remained negative, with decliners outnumbering advancers 18 to nine.

Foreign investors were net buyers, recording P503.33 million in inflows, while market turnover reached P6.30 billion.

Services led sectoral gains, rising 1.53 percent, while financials fell 0.61 percent. Ayala Land Inc. climbed 3.09 percent to P16 to lead index gainers, while PLDT Inc. dropped 4 percent to P1,200, making it the biggest laggard.

Mynt Inc. shares edged down to P6.59, one centavo below their IPO price of P6.60 per share.

Equity investors remained cautious ahead of the BSP’s monetary policy decision, with persistent inflation risks and the peso’s weakness complicating the outlook for interest rates and domestic financial conditions.