BSP intervenes when peso is ‘under stress’ — Remolona

The Bangko Sentral ng Pilipinas (BSP) said Tuesday it intervenes in the foreign exchange market when the Philippine peso is “under stress” amid the local currency’s recent decline to a 19-month low.

The peso, on Monday, closed at P58.68:$1, its weakest showing since November 3, 2022 when it finished at P58.80:$1.

Since the beginning of the year, the peso has shed over 5% of its value against the US dollar.

“When do we intervene? We don't intervene everyday. We intervene when we have to and when we say we have to, it's when the currency is under stress,” BSP Governor Eli Remolona said.

“Under stress means we find some dysfunction in the market. There's maybe, when liquidity disappears and then we intervene to provide more liquidity,” the BSP chief said.

The Philippine central bank governor added that the BSP also intervenes in the foreign exchange market when the peso moves in the “wrong direction.”

“Sometimes the peso goes sharply in the wrong direction and then we might intervene,” Remolona said.

“When I say the wrong direction… It's because we have access to market intelligence —we talk to dealers, we look at Bloomberg... there's narratives that circulate around the market and sometimes the narratives are just false and so we intervened basically to express our own view about where the peso should be going,” he added.—RF, GMA Integrated News