Malacañang on Monday expressed belief that the peso will soon bounce back after the currency fell to its lowest exchange level in nearly 11 years against the US dollar.
“We stand foursquare behind and beside BSP Governor [Nestor] Espenilla in his continued prudent management of our currency and the country’s international payments position,” Presidential Spokesperson Ernesto Abella said in a briefing.
The peso sank to its lowest in 11 years against the dollar on a widening trade deficit and external developments, particularly the tension between the US and North Korea.
The local currency lost 10 centavos to close at 51.08 against the greenback Monday from 50.98 on Friday. It was the peso’s lowest since it settled at 51.21 to a dollar on Aug. 28, 2006.
Trading volume at the Philippine Stock Exchange thinned to $291.5 million Monday from $690 million Friday.
Abella echoed Bangko Sentral ng Pilipinas chief Espenilla Jr.’s explanation that the peso was not expected to have a “free fall,” as the country’s macroeconomic fundamentals remained solid and strong.
“We expect that as international tensions ease and remittances rise, and trade and tourism revenues pick up in latter months, those holding pesos will see their funds rise again,” Abella said.
“Over the long term, we share the [BSP] Governor’s confidence that the peso gets stronger amid our solid fundamentals, massive currency reserves and increasing attractiveness to foreign investments as our infrastructure upgrades and expands,” he added.