Dollar Strengthens as Federal Reserve Delays Interest Rate Cut, Affects Philippine Peso

Manila – The U.S. dollar strengthened following an announcement by the Federal Reserve to delay adjustments to interest rates, impacting global currency markets including the Philippine peso, which depreciated past the 58 to a dollar mark.

According to Philippines News Agency, the peso’s slide to beyond 58 against the dollar aligns with trends observed in other regional currencies. “The dollar continued to strengthen as the Federal Reserve signaled delay in cutting interest rates,” Remolona explained. This statement was made in light of the peso’s performance during Tuesday morning’s trading session.

Federal Reserve officials have indicated that a rate cut would not be considered until inflation consistently meets their target of 2 percent. In response to the volatility, Remolona reassured that the BSP is closely monitoring the situation. While the central bank allows the currency market to operate freely without defending a specific exchange rate, it stands ready to intervene. “Nonetheless, the BSP will participate in the market when necessary to smoothen excessive volatility and restore order during periods of stress,” he affirmed.