Peso Hits Record Low, May Stay Weak Until 2027

Until 2027, the value of the Philippine peso may remain at about 60 per dollar. This is a result of the ongoing conflict in the Middle East, which is causing instability in the world economy.

The Middle East is where the Philippines purchases the majority of its oil. The nation must spend more money to cover rising oil prices. The peso is weakened as a result of this pressure. The similar issue affects other nations like Pakistan and Sri Lanka.

The peso fell to a fresh all-time low of 60.1 per dollar last week. The previous record of 59.87, established only a few days prior, was surpassed by this. The peso surpassed 60 pesos for the first time in history.

After the US Federal Reserve opted against lowering interest rates, the US currency strengthened. Fed Chair Jerome Powell stated that they will “wait and see” in light of the conflict-related pricing increases. The peso depreciates as the dollar strengthens.

According to the Bangko Sentral ng Pilipinas (BSP), it is closely monitoring the situation. If oil prices remain above $100 for an extended period of time, interest rates may rise.

Additionally, experts cautioned that rising oil prices might drive up the cost of food. In the Philippines, where food accounts up a significant portion of family budgets, this is a major issue. Only if the Middle East war ceases or settles down quickly might the peso rebound.