The peso recovered on Friday, Nov. 21, strengthening to P58.87 against the US dollar, following its recent dip to a two-year low of P59.
Data from the Bankers Association of the Philippines showed that the local currency appreciated by 13 centavos from Thursday’s closing rate of P59 against the greenback.
During Thursday's trading session, the peso opened at P58.95 against the dollar. Its intraday best was P58.81, while its intraday low stood at P58.96.
Trading volume for the US dollar increased to $1.07 billion on Friday from $842.68 million on Thursday.
Earlier this week, the Bangko Sentral ng Pilipinas (BSP) said it was closely monitoring the situation but was not particularly concerned about the current depreciation.
BSP Governor Eli Remolona Jr. said the central bank was primarily focused on the potential inflationary impact of a sharp and sustained decline in the peso’s value, adding that the BSP does not intervene in daily currency fluctuations.
According to Michael Ricafort, chief economist at Rizal Commercial Banking Corp. (RCBC), the peso strengthened amid a broader dollar correction against Asian currencies and inflation management efforts.
Ricafort said the peso-dollar exchange rate eased as markets anticipated increased cash remittances for holiday spending, benefiting dollar holders with higher peso conversions, but raising concerns over higher import costs and inflation.
Since early 2024, the peso has weakened by 6.3 percent against the US dollar, raising concerns over higher import costs and inflation. Since the Russia-Ukraine war began in February 2022, the peso has depreciated by 15.2 percent.
Ricafort noted that global crude oil prices near multi-year lows may support lower inflation, easing pressure on the peso amid reduced oil demand driven by China's economic slowdown.