The Philippine peso breached the 52-per-dollar mark on Monday for the first time in almost two and a half years, with expectations that it will get even weaker over the next few months due to the worsening Russia-Ukraine conflict. | RonWDomingoINQ /PDI
“Dovish comments from the central bank may have also hurt the currency with BSP Governor Diokno reiterating his preference to keep rates untouched for now,” it added.
The BSP chief has also said inflation would stay within the government’s target band of 2 percent to 4 percent if crude oil averaged at less than $95 per barrel.“He has also cited the peso’s general tracking of regional peers even if the local unit has largely underperformed and is now headed to a 2-percent depreciation for the year,” he added.The economist said the BSP might be expected to step up presence in the spot market to smooth out volatility.
“The BSP views such development as a result of the impact of the geopolitical tensions on oil prices, which likewise affected the peso,” Diokno said. “But this is in line with the behavior of other currencies in the region, which also depreciated against the US dollar.”