The peso pierced the 48 to one dollar barrier on August 11, hitting its strongest level in four years due to weak demand for the greenback.
The local currency gained nine centavos to close at 48.92 from August 10’s close of 49.01 to one dollar. This is the peso’s strongest level since closing at 48.66 to one dollar on November 10, 2016.
Ruben Carlo Asuncion, chief economist at Union Bank of the Philippines, a factor leading to the sustained appreciation of the peso was the persistent lack of onshore dollar demand amid the backdrop of a deep domestic recession.
ING Bank Manila senior economist Nicholas Mapa said the peso continues to strengthen as the current account moves back into surplus despite a projected 10 to 15 percent drop in overseas Filipino workers’ remittances.
Mapa said the current account moved back to positive territory as imports imploded, due in part to the drop in economic activity and capital formation in particular.