Philippine Peso Expected to Stabilize Amid Falling Oil Prices
BofA Global Research predicts near-term stability for the Philippine peso as declining oil prices and seasonal remittances offset previous import cost pressures.
The Philippine peso is expected to achieve near-term stability following a year of significant pressure driven by Middle East conflicts and rising oil prices. According to BofA Global Research, a combination of declining oil costs and a seasonal increase in remittances is providing temporary relief for the currency, which recently traded at 63.04 pesos to the U.S. dollar.
Despite this short-term outlook, the medium-term trajectory for the peso remains negative. The Philippines faced high import costs throughout the year, contributing to a current-account deficit that reached 6.3% of GDP in the first half of 2026.
Analysts state that Brent crude prices must drop to $70 per barrel to narrow the current-account deficit to a sustainable level of approximately 2%. Until this threshold is met, the currency is likely to remain vulnerable to broader economic volatility.
