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BSP won’t intervene to soften strong peso


The Bangko Sentral ng Pilipinas (BSP) will not intervene to soften the strengthening local currency that weighed down income of overseas Filipinos and exporters.

BSP Governor Benjamin E. Diokno said that a stronger peso against the US dollar is more advantageous for all Filipinos amid uncertainly brought about by the coronavirus pandemic.

“We adopt a policy that what’s is the greatest good for the greatest number,” Diokno said during the Development Budget Coordination Committee virtual briefing at the House of Representatives.

“A strong peso means that we are able to control inflation, as you now know low inflation favors all—exporters, importers, found and old, rich and poor—it favors all,” he added.

Year-to-date, the local currency appreciated by 3.9 percent to close at P48.62 against the US dollar today, compared to its closing rate of P50.64 at end-December.

Among the Asian currencies being monitored, the peso also strengthened year-to-date with the Chinese renminbi, Taiwanese dollar and Japanese yen.
Diokno also said that stronger peso will help boost the country’s gross international reserves (GIR).

“This time we’re experiencing a slight strengthening of the peso, in fact I forecast that before the end of the year we will hit the GIR as high as $100 billion, it’s the highest ever,” the central bank chief said.

“What’s good for the greatest number, I think at this time, especially because of the uncertainty, a strong peso, a higher GIR is more advantageous for all Filipinos,” he added.

Earlier, the Philippine Chamber of Commerce and Industry urged government to “review” the steady appreciation of the peso against the US dollar following concerns raised by businessmen and exporters on the competitiveness of their products in the world market.


Source: Manila Bulletin (https://mb.com.ph/2020/09/04/bsp-wont-intervene-to-soften-strong-peso/?utm_source=rss&utm_medium=rss&utm_campaign=bsp-wont-intervene-to-soften-strong-peso)

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