MANILA – The Philippine peso tumbled to a new all-time low, closing at 59.22 against the US dollar on Tuesday, December 10, 2025, shedding 28.5 centavos from its prior finish and underscoring deepening pressures from anticipated Bangko Sentral ng Pilipinas (BSP) easing and a resilient greenback. The depreciation, which marked the currency’s weakest level since its 59.17 trough on November 12, played out in subdued trading with a volume of $1.1 billion, reflecting investor caution in a market squeezed by domestic fiscal strains and global monetary divergences.
The slide gained steam as markets fully priced in a 25-basis-point BSP policy rate cut to 4.5% at the December 11 Monetary Board meeting—the eighth trim in a dovish cycle that has shaved a cumulative 200 basis points since August 2024. All 13 economists polled by the Inquirer last week foresee the move, positioning it as a growth salve for an economy that expanded at a dismal 4% in the third quarter, the slowest in over four years. “The peso reached new lows today as market views firmed that the BSP will very likely deliver a rate cut,” a trader observed, pinning the weakness on a strengthening dollar buoyed by speculation of a divided Federal Reserve (Fed) tempering its own easing amid sticky inflation cues.
November’s core PCE price index, the Fed’s favored gauge, climbed to 2.8% year-on-year from 2.7% in August, suggesting persistence above the 2% target that could limit US cuts and widen interest rate gaps favoring the dollar. Analysts anticipate intraday peso swings between 59.10 and 59.35 in the short term. The BSP, which lets market forces steer the exchange rate, steps in only against prolonged weakness that risks imported inflation—a line not yet crossed, as November’s headline rate softened to a four-month low of 1.5%.
Economic Double-Edged Sword: Remittances vs. Imports
The peso’s fragility cuts both ways: It amplifies remittances—a key consumption driver for the archipelago—but inflates import costs, potentially stoking price pressures on essentials like oil and rice. With Q3 growth hampered by delayed public spending tied to probes into the P20-billion flood control graft scandal, the BSP’s dovish stance seeks to ease credit flows, though Philippine Institute for Development Studies senior fellow John Paolo Rivera cautions of limited transmission if sentiment stays shaky. “Monetary easing works best when firms are confident enough to borrow and invest.”
The scandal’s fallout—implicating officials in kickbacks and phantom projects—has chilled investor appetite, contributing to the peso’s 7.5% year-to-date drop. Foreign direct investment inflows flipped positive in August but were 40% lower year-on-year, per central bank data. A potential Fed cut could narrow differentials and aid the peso, but upside risks from US inflation and typhoon-hit supply chains persist.
For households eyeing holiday budgets, Tuesday’s rout means steeper import and fuel tabs, though remittances could soften the blow. As the BSP convenes, the focus sharpens on whether a December trim steadies nerves or signals stormier seas—in a nation where every centavo pinches, the peso’s record rout isn’t mere math; it’s a market’s muted cry for clarity.
Peso Snapshot (December 10, 2025):
| Metric | Value | Change from Prior |
|---|---|---|
| USD/PHP Close | 59.22 | -0.285 |
| Trading Volume | $1.1 billion | N/A |
| YoY Depreciation | 7.5% (since Jan 1) | N/A |
| BSP Policy Rate (Exp.) | 4.5% (post-cut) | -0.25 bps |