The Philippine peso reached a new all-time low on Monday, closing at P61.75 against the US dollar, down by 2.9 centavos from its previous record of P61.721 set last Friday. Simultaneously, the Philippine Stock Exchange index (PSEi) fell by 35.25 points, or 0.59 percent, ending the day at 5,941.52. Market experts noted that investors are increasingly reacting to both global and domestic uncertainties, with sentiment playing a significant role in the peso’s performance.
Traders pointed out that the dollar’s robust strength, coupled with a heightened demand for safe assets, is influencing the peso’s decline. Additionally, oil-related dollar demand and a growing sensitivity to domestic issues are contributing to the currency’s weakness. The market’s current positioning and momentum are also factors, especially given the thin trading liquidity, which can amplify currency movements. Analysts suggest that the peso may weaken further, with P62:$1 now considered a psychological threshold, though significant fluctuations are expected.
The peso’s fall is mirrored by other regional currencies like the Indonesian rupiah and Indian rupee, both of which have also hit record lows. The rupiah dropped 1.16 percent to 17,665 per dollar, marking its largest intraday loss since April 2025. Meanwhile, the Indian rupee reached a historic low of 96.303 per dollar, continuing its downward trend that began when oil prices surged after tensions escalated in the Gulf region in February.
Experts, including MUFG analyst Michael Wan, attribute the pressure on Asian emerging market currencies to the stronger US dollar. The peso and rupee are particularly vulnerable due to high oil prices, while the rupiah faces additional domestic challenges. Geopolitical tensions in the Middle East, especially recent threats from former President Trump toward Iran, are causing investors to adopt a defensive stance, according to Japhet Tantiangco, a research manager at Philstocks Financial Inc.
Investor caution is reflected in the sluggish trading activity, with net value turnover falling to P3.85 billion, below the year’s average. Foreign investors are also refraining from active participation, as indicated by net outflows of P225.76 million. The property sector was the only one to see a slight positive movement, rising by 0.19 percent, while mining and oil stocks experienced a significant decline of 3.4 percent. Overall, the market breadth was negative, with more decliners than advancers, signaling continued investor hesitation amidst the ongoing uncertainties.