Peso appreciation vs US dollar possible before end of 2026: economist

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MANILA – The Philippine peso still has the capacity to strengthen towards the end of the year given the seasonal upticks in remittance inflows and domestic d...

OPTIMISM. An economist forecasts the Philippine peso to strengthen against the US dollar before the year ends, attributing this to a seasonal surge of inflows from overseas Filipino workers and the strong domestic demand during the Christmas holidays, which benefits exporters, among others. To date, the local currency is trading at the 63 level against the US dollar, an improvement after it touched the 64 level in late August. (PNA file graphics)

MANILA – The Philippine peso still has the capacity to strengthen towards the end of the year given the seasonal upticks in remittance inflows and domestic demand, an economist said Thursday.

Michael Ricafort, Rizal Commercial Banking Corporation chief economist, in a reply to questions from the Philippine News Agency, said higher sales and demand locally and in the export market in the last quarter of the year will help buoy the local currency against the US dollar.

“The seasonal increase in OFW (overseas Filipino workers) remittances, export sales, and other US dollar sales/earnings/income to be converted to pesos in [fourth quarter] in time for the Christmas holiday-related spending (will help the peso),” he said.

Data from the Bangko Sentral ng Pilipinas (BSP) as of 2023 show that OFW remittances for December registered the highest figure over the 12-month period.

Ricafort said US dollar sales and earnings from business process outsourcing (BPO) and export firms for employees’ wages and holiday-related disbursements also help boost the local currency.

He added that the Central Bank’s intervention to address extreme volatility in the foreign exchange market, along with foreign exchange inflows for securities and bond investments into the country, also benefits the Philippine peso.

The local currency touched the 64 level against the US dollar for the first time on Oct. 27, traced to outlook on the domestic economy, anticipations on the rate decisions of major central banks, and the elevated inflation rate.

However, it has…

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