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Marcos says Philippines ready to defend peso as currency slumps

Bloomberg
·2-min read
Ferdinand Marcos Jr., Philippines' president, speaks during a Bloomberg Television interview in New York, US, on Friday, Sept. 23, 2022. Marcos has pledged to strengthen political and economic ties with the US, in contrast with his predecessor Duterte, saying that his nation looks to the US whenever in crisis.
Ferdinand Marcos Jr., Philippines' president, speaks during a Bloomberg Television interview in New York, US, on Friday, Sept. 23, 2022. Marcos has pledged to strengthen political and economic ties with the US, in contrast with his predecessor Duterte, saying that his nation looks to the US whenever in crisis. (Bloomberg)

By Andreo Calonzo and Ditas Lopez

Philippine President Ferdinand Marcos Jr. said the nation is prepared to defend the peso as the currency’s slide this year threatens to fuel inflation.

“We may have to defend the peso in the coming months,” Marcos said in a post on his Twitter account after meeting with his economic team on Tuesday. “Number one priority is still inflation. We will continue to use interest rates to mitigate the effects,” he said in another post.

The Philippines is stepping up its efforts to bolster the peso as the US dollar’s relentless climb higher pummels global currencies. The government is closely watching the foreign-currency market to determine the best course of action to arrest the decline in the currency, Economic Planning Secretary Arsenio Balisacan said earlier in the day.

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“We are monitoring also the developments closely so we can also deploy our monetary tools like the interest rate, for example, and how we can intervene in the financial market to tame the depreciation of the peso,” Balisacan told a briefing.

The peso is clinging to a key support at the record-low 59 per dollar level. The currency has lost more than 13% this year.

The Philippine central bank said this month it may add to Southeast Asia’s steepest rate hike this year with a possible 75-basis-point increase in November. Authorities are also monitoring currency transactions for potential speculation, Finance Secretary Benjamin Diokno said last week.

Policymakers are worried that currency weakness is feeding into inflation at risk of quickening to a 13-year high. The central bank has already drained billions of dollars from the nation’s reserves, which have fallen more than 12% this year.

©2022 Bloomberg L.P.