BMI cites factors pressuring peso this year W
THE DYNASTY ISSUE Sen. Risa Hontiveros answers questions from Senate media reporters
during a press conference on Monday, February 9, 2026, where she addressed political dynasty issues. She said those moving to finally enact a law against political dynasties, nearly four decades since the 1987 Constitution, are hoping that current efforts have finally gained momentum. She said more local consultations at the grassroots level, such as that hosted recently by Pasig City Mayor Vico Sotto, will be held. ROY DOMINGO
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EAKER export growth, monetary easing and higher inflation are expected to put pressure on the Philippine peso in 2026, according to BMI, a Fitch Solutions company. “We expected the Philippine peso to weaken from P58.76/USD to around P59.50/USD by end2026,” BMI said in a commentary. In the near-term or within the three to six months’ time frame, BMI expects the Philippine peso to trade sideways around P59 against the greenback. BMI explained that the local currency has remained “under pressure,” hitting a record low on
January 15 at P59.50 per dollar, before paring back to the spot rate P58.76 per dollar. “Even with the recent rebound, the peso continues to underperform relative to the 100-day and 200-day moving averages reflecting persistent depreciation pressure,” said BMI. BMI said the weakening of the peso towards the end of the year could be pinned on the moderate growth of Philippine exports, underscoring that it expects export frontloading to fade this year.
Moderate export growth
“WE expect the Philippine exter-
nal position to come under pressure in 2026,” BMI said in its currency forecast for the Philippines. This is what the BMI forecasts for Philippines’s outbound shipments this year even as the country’s merchandise exports rose 15.2 percent in 2025. BMI said Philippine exports in the previous year was supported by export frontloading and AI-driven tech exports, which also drove a “narrowing” of the current account deficit from 4 percent in 2024 to an estimated 3.4 percent in 2025. “Even so, the peso depreciated by 1.5 percent year-on-year in 2025 as corruption concerns
weighed on investor confidence,” BMI noted. Looking ahead to 2026, however, BMI expects that the tailwind from exports on the peso will fade. “While the AI boom should provide support to exports, we expect export frontloading to fade,” said BMI. It also noted that the 19 percent “reciprocal” tariff levied on Philippine exports to the US since August 2025 will start “feeding through and dampen trade” with the US—the Philippines’ largest export market. “Against this backdrop, we maintain that export growth will See “BMI,” A2
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‘GRADUAL 50-BPS RATE CUTS LIKELY THIS YEAR’ www.businessmirror.com.ph
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Tuesday, February 10, 2026 Vol. 21 No. 121
P25.00 nationwide | 2 sections 20 pages | 7 DAYS A WEEK
By Andrea E. San Juan
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@andreasanjuan
HE Bangko Sentral ng Pilipinas (BSP) may deliver “gradual” 50-basis-point policy rate cuts in 2026 as inflation is expected to settle within the central bank’s target range with “manageable” price pressures, according to Maybank. “Recent inflation developments support continued easing, but argue for greater caution in the near term, which will see the BSP to adopt a more measured approach, balancing the still-soft growth conditions against emerging inflation risks,” Maybank said. Maybank’s latest economic brief noted that overall, the inflation environment remains “broadly benign.” However, it noted that upside risks persist from utility tariff adjustments, imported cost pressures, volatile global oil prices and peso movements. The Malaysia-based bank noted inflation is expected to remain “manageable” this year at around 2.2 percent which is within the 2 to 4 percent target band of the BSP. According to Maybank, while headline inflation rose to 2 percent in January 2026, marking an 11-month high, it remains at the lower bound of the target and within the BSP’s target range. “Essentially, the pickup was largely driven by housing and utility-related costs, pointing to supply-side and costpush pressures. However, the increase in core inflation to 2.8 percent year-onyear suggests some modest widening of underlying price pressures, warranting closer monitoring in the months ahead,” said Maybank. “Nonetheless, Maybank said it continues to expect 50bps policy rate cuts over 2026, bringing the policy rate down to 4.00 percent, as inflation stabilizes within BSP’s target range with manageable upside pressures,” added Maybank. Meanwhile, on the growth front, it pointed out that the macroeconomic backdrop remains “mixed.” “Private consumption and an accommodative monetary policy stance should continue to provide a key buffer for domestic demand amid the still benign inflation environment,” the bank noted. Despite external headwinds amid geopolitical risks and ongoing domestic See “Rate cuts,” A2
EDSA TAKES A RAIL BREAK Parts of Edsa near West and North Avenues in Quezon City will be temporarily closed to traffic as the Metropolitan Manila Development Authority and the Department of Transportation implement scheduled girderlaunching works for the Metro Rail Transit Line 7. The activity involves lifting steel superstructure components to connect the MRT-7 North Edsa turnback track along West Avenue, with lane closures in place to ensure public safety. NONOY LACZA
‘PHL-U.S. CRITICAL MINERALS DEAL A BOON TO ECONOMY’ By Ada Pelonia
T
@adapelonia
HE signing of an agreement on critical minerals between Manila and Washington will boost the country’s downstream industries, according to the Philippine Exporters Confederation Inc. (Philexport). This, after the Philippines, through the Department of Environment and Natural Resources (DENR), inked a Memorandum of Understanding (MOU) with the United States to coop-
erate on diversifying global critical mineral supply chains and promote investments. “The pact aims to pivot the Philippines from raw ore export to domestic processing of nickel, cobalt, and graphite, enhancing high-value exports and supply chain security,” Philexport said in a statement. “This partnership is anticipated to attract investment, create jobs, and bolster the country’s role in the global high-tech supply chain,” it added. Philexport also said the MOU See “Minerals,” A2
Inflation to stay ‘broadly benign’ By Justine Xyrah Garcia
I
NFLATION in the Philippines is expected to pick up gradually this year but remain within the government’s target range, according to Maybank. Maybank Investment Banking Group analysts Azril Rosli and Suhaimi Ilias of Maybank Investment Banking said headline inflation is projected to average 2.2 percent year-on-year in 2026, up from 1.7 percent in 2025. This remains within the government’s 2 to 4 percent target band. “Overall, the inflation environment remains broadly benign, though upside risks persist from utility tariff adjustments, imported cost pressures, volatile global oil prices and peso movements,”
the analysts noted. Data from the Philippine Statistics Authority (PSA) showed headline inflation rose to 2 percent in January 2026, faster than December 2025’s 1.8 percent. The January print marked the highest inflation rate in 11 months, or since the 2.1 percent logged in February 2025. The acceleration was largely driven by the housing, water, electricity, gas, and other fuels index climbed to 3.3 percent in January, accounting for nearly half—or 45.9 percent—of the overall inflation acceleration last month. Electricity prices rose faster at 6.5 percent, up from 4 percent in December 2025, while rentals increased to 2.9 percent from 2.4 percent a month earlier. Slower
decline in liquefied petroleum gas (LPG) prices also contributed, with inflation easing to -2.8 percent from -5.1 percent in December. Inflation for restaurants and accommodation services likewise accelerated to 4 percent, accounting for 41.3 percent of the overall inflation increase in January. Maybank said such concentration in inflation uptick indicated that price pressures were driven mainly by cost-side factors. “Essentially, the pickup was largely driven by housing and utility-related costs, pointing to supply-side and cost-push pressures,” it said. However, the group noted that the increase in core inflation See “Inflation,” A2
PESO EXCHANGE RATES n US 58.6190 n JAPAN 0.3717 n UK 79.7218 n HK 7.5024 n CHINA 8.4522 n SINGAPORE 46.1313 n AUSTRALIA 41.0743 n EU 69.3580 n KOREA 0.0400 n SAUDI ARABIA 15.6309 Source: BSP (February 9, 2026)