Manila, Philippines – The peso has breached for the first time the P60-to-the-dollar level to end Thursday’s session at its weakest on record as an escalating war in the Middle East jolted energy markets and forced investors to shun Asian currencies.
Thursday’s exchange rate was P60.10 per dollar, a 58-centavo single-day loss for the peso, according to data from the spot currency market.
“The conflict is likely to stay elevated for weeks… with Brent prices remaining high in the near term,” said Jeff Ng, head of Asia macro strategy at SMBC. This makes currencies such as the won, rupee and peso “more vulnerable,” while the yuan, Singapore dollar and ringgit may prove more resilient, Ng said.
The Bangko Sentral ng Pilipinas (BSP) was believed to have intervened to cushion the currency’s fall during intraday trade when the peso sank to as low as P60.40 against the greenback.
“President Marcos and BSP Governor Eli Remolona met yesterday at Malacañang to discuss the currency situation. The BSP has intervened in the foreign exchange market to smooth the peso’s slide, but Remolona has been clear that the central bank is not drawing a line in the sand at any particular level,” economist and former Albay Rep. Joey Salceda said in a statement.
“Their doctrine is orderly adjustment, not defense. That is the right posture — but it means the burden falls on fiscal and sectoral policy to cushion the landing. Monetary policy will not do it alone,” he said.
Elsewhere, Asian currencies took a beating as Dubai crude surged.
Short positions on Asian currencies have edged higher, Reuters reported.
With the conflict in its third week now, investors have turned bearish on the Thai baht for the first time since early April 2025, according to a survey of 11 respondents. Short positions in the South Korean won and Taiwan dollar climbed to multi-month highs.
The shift in positioning reflects a sharp energy shock as the Middle East conflict has choked shipping through the Strait of Hormuz, a route carrying roughly a fifth of global oil supply, sending crude prices above $100 and fuelling inflation fears.
Higher oil prices are reviving a familiar playbook for Asia’s net importers, widening current-account deficits, raising subsidy burdens and pressuring central banks to defend currencies and delay monetary easing.
The won and Taiwan’s dollar have borne the brunt as investors also unwind exposure to tech-heavy markets. The won briefly broke 1,500 per dollar for the first time since 2009 after share trading halts were triggered in Seoul, prompting emergency meetings and pledges of “market-stabilising measures,” alongside fuel-tax cuts.
Bank Indonesia held rates at 4.75 percent this week as expected while intervening across forex markets with Governor Perry Warjiyo saying the central bank will introduce a new policy governing foreign currency transactions to support the rupiah.
In India, the rupee has repeatedly hit record lows despite central bank intervention.
Bearish bets on the baht were at their highest since May 2024, reflecting Thailand’s vulnerability to higher fuel costs, weaker tourism and a deteriorating current account.
By contrast, positions in the Singapore dollar were trimmed but remained positive. Authorities say markets continue to function normally and the currency remains within its policy band. Brokerages are split on whether the Monetary Authority of Singapore will hold or tighten policy in April.
On the flipside, the Chinese yuan and Malaysian ringgit have been relatively resilient, with the yuan supported by a firmer policy bias – including its strongest midpoint fixing in nearly three years – and solid economic data.
The ringgit, meanwhile, has outperformed regional peers, buoyed by Malaysia’s status as a net energy exporter and steady inflows for manufacturing and data-centre investments.
The Asian currency positioning poll is focused on what analysts and fund managers believe are the current market positions in nine Asian emerging market currencies: the Chinese yuan, South Korean won, Singapore dollar, Indonesian rupiah, Taiwan dollar, Indian rupee, Philippine peso, Malaysian ringgit and Thai baht.
The poll uses estimates of net long or short positions on a scale of minus 3 to plus 3. A score of plus 3 indicates the market is significantly long U.S. dollars. – with Reuters
