Banks vow to combat speculative attacks vs peso

MANILA, Philippines — Philippine banks are stepping to the plate to introduce more stability to the peso as the local unit continues to weaken amid a resurgent dollar reigning king in foreign exchange markets these days. 

In a statement on Wednesday, the Bankers Association of the Philippines said they are committed to maintaining order in the fixed-income and forex markets and will work “against speculative activities that tend to distort market prices and hurt the economy.”

“With global headwinds adversely affecting inflation and foreign exchange rates across the world, the BAP joins national efforts to minimize its impact on our people by avoiding activities that can only worsen the situation,” BAP President Antonio Moncupa said.

The BAP expressed support for the policies implemented by the Bangko Sentral ng Pilipinas, which include supervising orderly markets. That said, the BAP monitors the peso’s performance in the forex market by publishing weekday spot market updates. 

The central bank issued a similar advisory last week to protect the peso from further speculation in the forex markets. 

As it is, the peso's continued decline is foreboding for a Philippine economy reeling from imported inflation driven partly by expensive oil. The Philippine economy is also looking to regain economic momentum as it recovers from pandemic fallout in the past two years.

The peso waded to new lows last week as it hit P59 against the greenback. 

“In order to be part of the solution, the banking industry continues to work closely with the BSP for orderly, fair, and transparent markets minus the unproductive activities that only hurt the public,” Moncupa said.