The Philippine peso finished its weakest under the administration of President Rodrigo Duterte on Monday at P48.25 much noticeably lower than the P48.33 in September 15, 2009 but still far from the P47.16 of Nov. 10, 2015.
Trying to explain the cause or identify the source as possible culprit, a ranking executive of the Bangko Sentral ng Pilipinas (BSP) said negative perception of the market is driving the weakness of the Philippine peso.
Safely pointing the “blame” outside of the country, local monetary officials and economists expressed that anticipations for the eventual increase in the Federal Reserve key rates as the primary reason for the volatilities in Asian financial markets to date.
But other factors such as this week’s meeting of the Organization of Petroleum Exporting Countries (OPEC) in Algeria and the first official presidential debate in the US are also contributing to the volatilities.
Some analysts said results of the November 2016 national polls in the US is a cause of concern for businessmen since both candidates back policies that would give more opportunities to US residents.
On Monday BSP Deputy Governor Diwa Guinigundo expressed that the country’s strong macroeconomic fundamentals have never changed.
”They have remained stable and robust. But because of perceived risks which may not really be justified and continuing uncertainty about the unknown in the calculus of foreign exchange traders, they have embraced negative sentiment rather than focus on fundamentals,” he said.
”No(t) even the real interest rate differentials which are rather manageable could justify the sharp fall of the peso except the negative perception of the market,” he added.
The BSP official did not specify the source of the negative perception of the market, though. (PNA)