The currency touched a record intraday low of 63.15 against the US dollar, a moment of mixed emotions for a country that both earns and spends in dollars
A Number Nobody Wanted
MANILA. The Philippine peso weakened past 63 to the US dollar on Thursday, October 15, touching an intraday low of 63.15, a new record, according to GMA News’s report on the peso breaching 63 to the dollar, citing Bankers Association of the Philippines data. The peso had opened at 62.83 and closed the previous day at 62.87, just three centavos above the record closing low of 62.90 set on October 8. The new intraday low surpassed the previous record of 62.925 from September 15.
The news landed differently in different households, depending on whether the family earns in dollars or spends in them, which in the Philippines often means both, in the same house, at the same dinner table.
The OFW Bonus
For the millions of Filipinos who work abroad and send money home, a weaker peso means each dollar buys more at home. A nurse in Dubai, a seafarer in the Pacific or a caregiver in California sending 500 dollars home now delivers a few more pesos than a few months ago. Families of overseas workers reported a modest sense of celebration, quickly tempered by the realisation that prices at home also tend to rise when the peso weakens.
A remittance centre employee in Quezon City described the mood. The families come in smiling, she said. The dollar is strong. They get more pesos. Then they go to the supermarket. Then they stop smiling. It is a very short celebration. Like a birthday party where the cake is small.
The Imported Cheese Crisis
For consumers who buy imported goods, from gadgets to fuel to the much-loved queso de bola that appears on every Noche Buena table, a weaker peso means higher prices. The country imports a significant share of its fuel, a fact that ripples through transport fares, electricity bills and food prices. With Christmas approaching, shoppers are already calculating the cost of the festive feast.
A homemaker in Makati said she was reconsidering her holiday menu. Every year, we have ham, cheese, spaghetti and fruit salad with imported fruit cocktail, she said. This year, the ham is expensive. The cheese is expensive. The fruit cocktail is expensive. I am thinking of serving rice and gratitude. My husband says that is not festive. I say gratitude is free.
The Gadget Factor
The weaker peso also affects the price of phones, laptops and gaming consoles, which are typically priced with the dollar in mind. Young Filipinos hoping for a new phone for Christmas have begun preparing their parents for the possibility of a different gift. A university student in Manila said he had lowered his expectations. Last year I wanted the newest phone, he said. This year I want the newest phone case. For my old phone. It is a mature decision. My mother is proud.
What Moves The Peso
Exchange rates are influenced by many factors, including interest rate differences, trade balances, investor sentiment and global events. The GMA report did not specify a cause for the latest decline. Economists more broadly have pointed in recent months to factors such as a strong US dollar, global uncertainty and energy prices linked to conflict in the Middle East, which raise the cost of the country’s fuel imports. Central banks can intervene in currency markets, but their ability to resist global pressures is limited.
A business columnist in Manila summarised the situation for her readers in simple terms. When the world is nervous, she wrote, money runs to the dollar. When money runs to the dollar, the peso feels lonely. When the peso feels lonely, your groceries become expensive. That is economics.
The Travel Equation
For Filipinos planning trips abroad, the weaker peso makes foreign travel more expensive. Trips to Japan, Korea and Hong Kong, popular holiday destinations, now cost more in peso terms. Meanwhile, for foreign visitors, the Philippines becomes cheaper, a silver lining that tourism officials have been quick to note. A travel agent in Pasay said bookings for outbound holidays had slowed slightly. People still want to see snow in Japan, she said. But now they want to see slightly less snow.
Students studying abroad and their families face particular pressure. Tuition fees, rent and living costs in foreign currencies become more expensive in peso terms, forcing parents to send more money home or ask children to find part-time work. A father in Laguna whose daughter studies in Australia said he had begun checking the exchange rate every morning before breakfast. It is my new horoscope, he said. If the peso is strong, I have a good day. If the peso is weak, I eat less breakfast.
The Sari-Sari Store Indicator
For many Filipinos, the real measure of the economy is not the exchange rate but the price of everyday items at the neighbourhood sari-sari store. A store owner in Tondo said she watched the currency news carefully. When the peso drops, my suppliers raise prices, she said. Then I raise my prices. Then my customers buy smaller packs. Sachet shampoo, sachet coffee, sachet everything. The Philippine economy runs on sachets.
The Last Word
At a remittance centre in Pampanga, a woman collecting money sent by her daughter in Canada counted the bills slowly and smiled. More pesos, she said. Good. Then she folded the money carefully and tucked it into her bag. Now I go to the market, she said. And we will see how long the good news lasts. Maybe until the fish stall. Maybe until the rice. But for five minutes, I am rich. In this economy, five minutes is a lot.