FX.co ★ Philippine Peso Falls Back Toward 61 Mark

The Philippine peso weakened back toward the 61-per-dollar level in early August, retreating from a six-week high reached earlier in the week, as markets reassessed the country’s economic outlook amid slowing growth and persistent inflationary pressures. Philippine GDP grew 2.3% year-on-year in the second quarter, the slowest pace since the fourth quarter of 2009 excluding the COVID-19 period, as the economy grappled with an energy shock linked to the Iran war and the fallout from a major corruption scandal. The weaker-than-expected reading followed the government’s DBCC decision in June to lower its 2026 growth target. At the same time, inflation remained elevated at 6.2% in July, easing for a third consecutive month but still above the BSP’s 3% target, reinforcing expectations of further monetary tightening. The BSP has raised interest rates by 50 basis points since April, and analysts anticipate an additional 50 basis points of hikes this year, likely delivered in two 25-basis-point increments at the August and October policy meetings.