Philippines: Philippine peso weakens to over-five-year low
January 20, 2016
In January, the Philippines peso (PHP) weakened against the U.S. dollar, continuing a trend that began in mid-May 2015. On 20 January, the currency traded at 47.87 PHP per USD, which represented the weakest value in over five years. The result was 1.2% weaker than on the same day of the previous month and 7.4% weaker on an annual basis.
The peso’s depreciation was driven by several factors. On the one hand, it reflects that the U.S. dollar is strengthening on the back of monetary tightening in the U.S. Adding to this, recent financial market turmoil in China lowered investors’ appetite for emerging market currencies. Nevertheless, the peso performed relatively well compared to many other emerging market currencies, mainly thanks to the Philippine economy’s resilience to international headwinds and solid remittances inflows.