Selloff sends peso near all-time low of P59:$1, PSEi further away from 6,000 level

Manila, Philippines - The peso dangerously courted its historic low of P59 against the dollar level on Monday as foreigners sold Philippine stocks that sent the main stock exchange index drifting further away from the 6,000 territory.

The local currency closed at P58.90 against the greenback, just 10 centavos shy of its record low of P59 last seen over 10 months ago, or on Dec. 19, 2024, spot currency market data showed on Monday, Oct. 27.

The Philippine Stock Exchange index (PSEi), meanwhile, tanked for a second straight session to lose 0.91 percent more and end trade at 5,933.76.

Hot money flowed out of the equities market with foreign net selling at P313.7 million. Foreigners buying and selling shares accounted for about a third of Monday’s heavy volume of P18.8 billion.

Foreign exchange-vulnerable shares – especially oil companies in the petrodollar system – performed the worst, with losses of nearly 3 percent.

“The Philippine market declined by nearly 1% as selling pressure persisted throughout the trading session,” brokerage house Regina Capital said in a note to investors.

“The depreciation of the PHP against the USD continued to make investors trade cautiously,” it added.

The dollar rose to a more-than-two week high against the Japanese yen on Monday at the start of a packed week of global trade negotiations and central bank meetings.

The spotlight is on the US Federal Reserve’s policy decision with a rate cut already priced in after soft inflation figures last Friday, and on the post-meeting remarks by Fed Chair Jerome Powell.

Locally, the Bangko Sentral ng Pilipinas is expected to release its October inflation forecast midweek that will provide clues ahead of next week’s official print.

Trade tensions between the US and China also had been hurting the peso last week, but this Thursday, an expected meeting between US President Donald Trump and Chinese President Xi Jinping in South Korea could be a breakthrough. The two leaders will decide on the framework of a trade deal hashed out over the weekend.

“Concerns at home over the pace of the infrastructure corruption probe may have also weighed on the peso,” BDO’s research unit said in a note on Monday before trade opened.

A fresh batch of company earnings data also influenced Monday’s market performance, Regina Capital said. – with Reuters