The Philippine peso reached a new historic low on Monday, and the stock market also declined as investors and traders became increasingly wary of both global and domestic uncertainties. The currency depreciated by 2.9 centavos, with the exchange rate hitting P61.75 to the dollar, compared to the previous record low of P61.721 on Friday. Simultaneously, the Philippine Stock Market index (PSEi) fell by 35.25 points, or 0.59 percent, closing at 5,941.52.
Market sentiment appears to be driving the peso’s movement more than economic fundamentals, a trader noted. While the dollar maintains its overall strength, today’s developments reflect a growing demand for safety, an increased need for dollars due to higher oil prices, and heightened sensitivity to domestic uncertainties. The trader emphasized that positioning and momentum are crucial at these levels, potentially amplifying movements when liquidity is thin.
The short-term outlook suggests a continued weakening of the peso, with P62:$1 now seen as a psychological threshold, although significant fluctuations in both directions are anticipated. In a broader regional context, the peso joined other Asian currencies like the Indonesian rupiah and the Indian rupee in hitting record lows. Escalating tensions in the Gulf region have driven oil prices and global yields higher, bolstering the dollar and putting pressure on oil-importing economies.
The rupiah, among the region’s weakest currencies, dropped 1.16 percent to 17,665 per dollar, marking its most considerable one-day percentage decline since April 2025. Meanwhile, the rupee reached an all-time low of 96.303 per dollar, continuing its downward trajectory that began when oil prices surged after the Iran conflict intensified in late February.
Analysts like MUFG’s Michael Wan have pointed out that Asian emerging market currencies are suffering due to the stronger dollar, with the rupee and peso particularly affected by rising oil prices. Additionally, units like the rupiah face domestic challenges. Philstocks Financial Inc.’s research manager, Japhet Tantiangco, highlighted renewed concerns over Middle East tensions following recent threats from Trump towards Iran, leading investors to adopt a defensive stance. Meanwhile, Luis Limlingan from Regina Capital Development Corp. remarked that investor interest remains subdued as they await more definitive market signals. He added that the combination of rising global crude oil prices and the peso’s ongoing weakness further dampens market sentiment. Trading volumes also remained low, with net value turnover dropping to P3.85 billion, significantly below the year-to-date average, indicating continued investor hesitation. Foreign investors also remained cautious, with net outflows amounting to P225.76 million. Only property stocks managed to see gains, rising by 0.19 percent, while the mining and oil sectors saw the steepest decline at 3.4 percent. Market breadth was negative, with 117 stocks declining, 65 advancing, and 68 remaining unchanged.
