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Peso rises on market gains, fewer infections.
The Philippine peso has been on the rise in recent weeks, thanks to a combination of positive market gains and a decrease in the number of COVID-19 infections in the country.
As of August 2021, the peso has been trading at around 50 to 51 pesos to the US dollar, a significant improvement from its low of 56 pesos to the dollar in March 2020. This upward trend can be attributed to several factors, including the country’s strong economic fundamentals, the government’s successful vaccination rollout, and the easing of quarantine restrictions in many areas.
One of the main drivers of the peso’s recent gains has been the strong performance of the Philippine stock market. Despite the ongoing pandemic, the Philippine Stock Exchange (PSE) has been on an upward trajectory, with the benchmark PSEi index reaching record highs in July 2021. This has boosted investor confidence in the country’s economy and helped to attract foreign capital, which has in turn strengthened the peso.
Another factor contributing to the peso’s strength is the declining number of COVID-19 cases in the Philippines. After a surge in infections earlier this year, the government implemented stricter quarantine measures in many areas, which helped to slow the spread of the virus. As a result, the number of daily new cases has been steadily decreasing, which has helped to ease concerns about the impact of the pandemic on the economy.
Overall, the peso’s recent gains are a positive sign for the Philippine economy, which has been hit hard by the pandemic. While there are still challenges ahead, such as the ongoing threat of new COVID-19 variants and the need to address long-standing structural issues in the economy, the peso’s resilience is a testament to the country’s strong fundamentals and the resilience of its people. As the country continues to navigate the pandemic and work towards a sustainable recovery, the peso’s strength will be an important indicator of its progress.