The Philippine peso sank to an all-time low of P59.13 against the U.S. dollar on Tuesday, marking its weakest level since December 2024, as investors reacted to mounting worries that a widening corruption scandal could weigh on the country’s economic outlook.
Tuesday’s close broke the previous record low of P59 per dollar set in December last year. The peso has been sliding steadily since September, when a congressional investigation into alleged irregularities in public works spending began to unsettle financial markets.
Traders said the scandal has sparked fears of capital flight and dollar outflows, with foreign investors seeking safe havens amid uncertainty. Stock analysts likewise warned that political instability could dampen investor sentiment in the coming months.
The Bangko Sentral ng Pilipinas (BSP) said it allows the peso’s value to be determined by market forces, though it may step in to curb excessive volatility.
“When we do participate in the market, it is largely to dampen inflationary swings in the exchange rate over time rather than to prevent day-to-day volatility,” the BSP said in a midday statement.
The central bank acknowledged that the currency’s recent slide may reflect “market concerns over a potential moderation in economic growth due in part to the infrastructure spending controversy, as well as expectations of additional monetary policy easing.”
Still, the BSP maintained that resilient dollar inflows — including remittances from overseas Filipinos, revenue from business process outsourcing (BPO) firms, and tourism receipts — should help cushion the peso from further declines.
“These inflows, alongside relatively fast economic growth, low inflation, and ongoing structural reforms, are expected to provide support to the peso,” the central bank said.
