On Monday, the Philippine peso sank to a new record low, closing at P61.75 to the dollar, down by 2.9 centavos from its previous all-time low of P61.721 set last Friday. The peso’s decline coincided with a downturn in the stock market, as the Philippine Stock Market index (PSEi) dropped 35.25 points, or 0.59 percent, ending at 5,941.52. Market observers indicated that both global and domestic uncertainties have heightened investor sensitivity, causing the currency to trade more on sentiment rather than fundamentals.
A trader noted that the peso’s decline is partly due to a strong dollar, compounded by rising demand for safety amid higher oil-related dollar demand and increasing domestic uncertainty. The trader added that in the current market environment, positioning and momentum are significant, especially in conditions of thin liquidity, which can amplify movements. The outlook for the peso remains skewed towards further weakening, with P62:$1 now within psychological reach, although sharp fluctuations in both directions are anticipated.
The peso’s slump is part of a broader trend affecting other Asian currencies like the Indonesian rupiah and the Indian rupee, both of which have fallen to record lows. Renewed tensions in the Gulf have driven oil prices and global yields upward, bolstering the dollar and putting pressure on oil-importing countries. The rupiah, among the region’s worst performers, tumbled 1.16 percent to 17,665 per dollar, marking its largest intraday percentage loss since April 2025. Meanwhile, the rupee reached an all-time low of 96.303 per dollar, continuing its downward trajectory that began with the Iran conflict’s impact on oil prices in late February.
According to MUFG analyst Michael Wan, the stronger dollar is heavily impacting Asian emerging market currencies, with the peso and rupee particularly affected by rising oil prices. The rupiah is also feeling the strain from domestic challenges. Japhet Tantiangco, research manager at Philstocks Financial Inc., highlighted that Middle East tensions have resurfaced as a focal point due to recent threats from Trump against Iran, making investors cautious. Luis Limlingan, head of sales at Regina Capital Development Corp., mentioned that investor interest remains subdued as they await clearer market signals. The peso’s continued weakness and escalating global crude oil prices are further dampening sentiment.
Trading activity was notably sluggish, with net value turnover plummeting to P3.85 billion, significantly below the year-to-date average, reflecting ongoing investor hesitation. Foreign funds also remained on the sidelines, with net outflows reaching P225.76 million. While property stocks managed to eke out a 0.19 percent gain, mining and oil led the declines with a 3.4-percent drop. Overall market breadth was negative, with 117 stocks declining against 65 advancing, while 68 remained unchanged.