Good news for all of you American expats living in the Philippines: Ph Peso Sinks to 6-Year Low Vs. USD. Yes, dear readers, it’s time for another exchange rate rant.
The peso fell to a six-year low this past Monday to close at 47.16 against the US dollar.
United States Federal Reserve chair Janet Yellen remarks that the economy was “performing well,” and that a rate hike in December is “a live possibility” has boosted the greenback.
The Philippine Peso has lost 5 percent since the start of 2015. Monday’s close was the peso’s weakest level since Oct. 22, 2009 when it stood at 47.195. As I write this article on Wednesday, the peso has improved ever so slightly to 47.15. The lowest rate thus far for the dollar this year was 44.4076 on May 15.
Past Predictions for the USD vs. PHP
I checked the archives of Philippines Plus to review the past stories I’ve posted regarding the Philippine Peso to US Dollar exchange rate. Here’s what I’ve come up with:
In February 2011 I delivered this blockbuster “Wide Range of Predictions for Philippine Peso vs. USD Exchange Rate.”
There were dire predictions of an exchange rate of PHP 37.50 to $1 in 2011 and PHP 35.50 in 2012 from HSBC (Hong Kong and Shanghai Banking Corp.) ( All Headline News.)
The fact is that on December 31st, 2011 the US Dollar closed at 43.7900, not the 37.50 to $1 rate predicted.
However, at the end of 2012, 1 US Dollar equaled 41.03 Philippine Pesos, still better than the 35.50 prediction but the lower rate was a cause for concern.
“US Dollar to Philippine Peso Exchange Update: Peso Hits 4-Yr High” was the title for a July 4, 2012 article. Frankly, it wasn’t one of my most exciting posts and I almost fell asleep reviewing it.
But the gist of the articles was that the Philippine Peso was growing stronger and had maintained the least volatility among Asian currencies. The peso posted the best appreciation against the US dollar among other Asian currencies from January to July 2 for 2012. The currency had appreciated by as much as 4.33 percent, the highest in the region.
Several months later on September 18, 2012, I followed up with this gem: “Latest Update on Philippine Peso to US Dollar Exchange Rate Predictions.”
The article cited a a report from Inquirer Business, which in a Sept. 17, 2012 article, reported that the DBS Group, A Singaporean financial services provider, stated that the local currency was seen trading against the dollar at P42.60 by year’s end. The peso had posted another record 41.56 to $1 last September 11, 2012.
DBS described the peso’s performance against the greenback to be stable between 41.20 and 43.80 to $1 in the next few months owing to favorable economic fundamentals.
Here’s the US Dollar to Philippine Peso 2013 exchange rate prediction that the The Bank of New York Mellon made in 2012 for the close of 2013:
Mellon’s 2013 4th Quarter Prediction? 1 USD= 40.00 PHP. The actual figures for the close of 2013 were 44.4000 PHP to 1 USD.
2013: We sink to our lowest level but rise again
On July 1, 2013, I ran this nail-biter: Philippine Peso Vs. US Dollar. Don’t ask me where I come up with this exciting titles. I’ve been called a “genius” by some expats that might have been drinking a bit too much that day.
In early June 2013 our exchange rate was 40.95 to 1, the lowest rate of exchange we have seen since moving to the Philippines over six years ago.
At the time this post was published, the rate had improved for us at 43.09 PHP to 1 USD. What happened?
Analysts say investors were dumping risky assets amid speculations the United States may withdraw its stimulus measures. American consumer confidence rose to a five-year high of 76.2 in May 2013.
Contrary to a Bank of America prediction in 2012 that the Philippine peso could hit 30 plus-level in 2013, the exchange rate versus US Dollar continued to weaken at the 43-to-$1 level that June. Above 43-mark is said to be the weakest since June 26, 2012 when it hit 42.47. (source: The Summit Express.)
Along with other American expat friends, we were quite relieved when the exchange rate improved at that time. As noted above, the PHP to USD exchange rate improved to 44.4000 by the end of 2013.
In 2014 I could not find a single post regarding the Philippine Peso to USD exchange rate. For the record, at the end of 2014 the rate had improved only slightly from 2013 to 44.7795 PHP.
Thus far, 2015 has been our best year for the exchange rate since moving to the Philippines in July 2009. Let’s hope this trend continues because I, for one, don’t mind having a few more pesos in my pocket. How about you?