Peso dollar rate
Image Credit: Gulf News / xe.com

Manila: When the peso tumbles, it favours those remitting to the Philippines, including overseas Filipino workers (OFWs) and local companies earning in dollars.

That took place on Tuesday (April 12), the second trading day during the Holy Week, as the Philippine currency slipped to its lowest level this month so far.

The local shares index also tumbled on supply chain concerns faced by producers, oil price volatility and US inflation data.

Philippine pesos
In the last 12 months, the Philippine peso has lost nearly 7 per cent of its value from Php48.57 against the greenback on April 12, 2021 to Tuesday's rate, according to BSP data.

Against the US dollar, the peso broke through the 52-level once more, due to expectations of higher US inflation. The Philippine currency lost five centavos from Php52.05 to Php52.10 at Tuesday’s close, Bankers Association of the Philippines data show.

Data from the Bangko Sentral ng Pilipinas Central Bank, meanwhile, show the peso ending Tuesday at Php51.91: $1 — still the lowest level for the month.

7% drop in peso value in 12 months

In the last 12 months, the Philippine peso has lost nearly 7 per cent of its value from Php48.57 against the greenback on April 12, 2021 to Tuesday's rate, according to BSP data.

Meanwhile, the Philippines’ main shares index finished the Holy Week’s second trading day 92.93 points weaker.

The main Philippine Stock Exchange index (PSEi) shed 1.14 percent, to end Tuesday at 6,895.36.

The All Shares index slipped by 1.14 per cent, or 42.37 points, to 3,685.84 points, following a decline of 11.24 points on Monday (at 3,728.21).

All sectors were in the red, with Industrials posting the biggest drop — 2.15% or negative 206.95 points — followed by Property, which registered a 1.83% drop among the sectoral indices, after it fell by 59.35 points.

The Mining and Oil sector was down 177 points or 1.44%, Services was down 1.42%; Financials, down by 1.30%; and Holding Firms, down by 0.64%.

Philippine stocks are down 3.19% since January 2022.

Analysts say the stock market sentiment is partly due the fact that investors priced in the outcome of the recent US Fed meeting, against the backdrop of continued oil price volatility due to on-going geopolitical tensions.

Following its March 15-16 meeting, the US Federal Open Market Committee (FOMC) raised the Federal Reserve’s key rates by 25 basis points — to between 0.25 to 0.5 percent — the first since December 2018. The move was made to help address the surge in the US consumer price index (CPI).

Meanwhile, Brent crude oil climbed 2.37% on Tuesday to $100.8 per barrel, as the world tries to get energy costs under control and the European Union remained split on Russian oil embargo.