Peso closes at ₧57.45, weakest in 3 mos T
HE Philippine peso closed at its weakest in nearly three months on the back of geopolitical uncertainties such as the Israel-Iran conflict, according to analysts. Data from the Bankers Association of the Philippines (BAP) showed that the peso closed at P57.45 to the US dollar on Thursday. This is the weakest since the P57.69 to the greenback close on March 26, 2025. University of Asia and the Pacific economist Victor A. Abola told BusinessMirror that it’s possible that the peso would stay weak because of “geopolitical uncertainties.” “The peso had appreciated strongly in H1 [first semester] as the US
WORLD » A8
PUTIN FLOATS ATOMIC PROGRAM SOLUTION IN OFFER TO MEDIATE ISRAEL-IRAN CONFLICT
ROTARY CLUB OF MANILA JOURNALISM AWARDS
2006 National Newspaper of the Year 2011 National Newspaper of the Year 2013 Business Newspaper of the Year 2017 Business Newspaper of the Year 2019 Business Newspaper of the Year 2021 Pro Patria Award PHILIPPINE STATISTICS AUTHORITY 2018 Data Champion
weakened, but [it] has in recent days recovered. I think the depreciation mode will stay since the ‘geopolitical uncertainties’ would have less effect on Philippine inflation, despite the recent spike in crude oil prices,” Abola said. Abola expects this weakness in the peso may not lead to a spike in inflation, but may lead to reduced earnings for exporters which would weaken the manufacturing sector. Signs of a weaker manufacturing sector have already been seen through the country’s Purchasing Managers Index (PMI) score. (See: https://businessmirror.com. ph/2025/06/02/may-factory-activity-indicates-stagnation/). The PMI index score of the coun-
“It should be temporary. It’s brought about by noise due to the Israel-Iran conflict. The whole of 2025, more dollars are expected to come in than to go out.”–Ateneo de Manila University economist Luis Dumlao
try fell to 50.1 in May from 53 in April. It can be noted that 50 is the
PMI threshold for an “overall increase” in factory performance. “The concern would be diversion of Chinese goods to the region, especially the Philippines, as Trump tariffs lessen exports to the US. Such a development will weaken further domestic production and employment, which BBM [Bong Bong Marcos] and policymakers would not want to happen,” Abola told this newspaper. Abola added that the best way to counter the diversion of Chinese goods and goods from other countries would be to depreciate the peso further, to a point where local manufacturers and exporters benefit and employment increases. See “Peso,” A2
BusinessMirror A broader look at today’s business
EJAP JOURNALISM AWARDS
BUSINESS NEWS SOURCE OF THE YEAR
(2017, 2018, 2019, 2020, 2021) DEPARTMENT OF SCIENCE AND TECHNOLOGY
2018 BANTOG MEDIA AWARDS
BSP CUTS RATES ANEW BY 25 BPS; 1 MORE SEEN www.businessmirror.com.ph
F
n
Friday, June 20, 2025 Vol. 20 No. 250
P25.00 nationwide | 2 sections 22 pages | 7 DAYS A WEEK
PBBM keeps 6 GOCC heads, lets go of 3 execs
By Cai U. Ordinario @caiordinario
ILIPINOS can expect at least one more rate cut after the Monetary Board of the Bangko Sentral ng Pilipinas (BSP) decided to implement its second 25-basis-point (bps) rate cut for the year on Thursday.
By Samuel P. Medenilla
P
WHY BSP LOWERED RATES–AND WHAT IT MEANS FOR YOU WHAT’S THE IMPACT? RISKS AHEAD
WHY DID BSP DO THIS?
Slowing Inflation n From 2.9% in January 1.3% in May n Inflation for poorest 30% of households: now 0%
Slowing Growth n GDP growth slowed to 5.4% in Q1 2025 n Weakness in exports and manufacturing Goal: Lowering interest rates makes borrowing cheaper, which can boost business and consumer spending.
The Monetary Board reduced the BSP’s Target Reverse Repurchase rate by 25 bps to 5.25 percent. The interest rates on the overnight deposit and lending facilities were adjusted to 4.75 percent and 5.75 percent, respectively. “We have three more policy meetings. We have August, October, December. If things remain on track, then we will probably cut once more. Depending on the data, we may cut twice more; depending on the data, we may not cut at all. But for now things remain on track, one more, one
n Oil price hikes from Middle East conflict
n If You’re a Borrower: Cheaper loans are possible — if borrowers feel confident enough to take them.
n Tariffs may return after US pause ends in July
n If You’re a Business: Reduced interest rates can lower borrowing costs — but “external shocks” like tariffs and oil prices could still hurt demand. n If You’re an OFW Family: A weaker peso means remittances have more peso value—good for local spending.
n Higher rice and electricity prices could spark inflation again
“If people are worried about the economy, they might still hold back. So while the cut helps, it’s not a silver bullet.” —Jonathan Ravelas, Reyes Tacandong & Co.
BM Graphics: Ed Davad
The Bangko Sentral ng Pilipinas just cut interest rates again—its second 25-basis-point cut this year. Policy rate is now 5.25% (from 5.50%)
more 25 basis points,” BSP Governor Eli M. Remolona Jr. said in a briefing. Remolona said the decision to reduce policy rates was pegged to inflation, which is now forecast to average 1.6 percent this year, lower than its initial estimate of 2.4 percent. The forecast for 2026, however, was adjusted upward to 3.4 percent from 3.3 percent while the estimate for 2027 is now pegged at 3.3 percent from the initial 3.2 percent. “We now recognize the slowdown in food inflation, something See “BSP,” A2
MINERAL PROCESSING, DATA HUB INVESTMENTS, BOI FOCUS By Andrea E. San Juan
D
RIVEN by new reforms and geopolitical factors, the Philippine government’s investment promotion arm will go slow on promoting Renewable Energy investments and shift its focus to attracting mineral processing, AI-led data centers, and semiconductor and electronics investments in the next three years. According to Board of Investments (BOI) Managing Head Ceferino S. Rodolfo, “For the next three years, we are no longer going to promote renewable energy, because we are already up to our ears when it comes to investment registrations. Our focus now would be on implementing easily, doing business, implementing all of these renewable energy
projects.” Rodolfo spoke at a forum on Thursday organized by the World Bank billed as “Philippines Economic Update: Small Business, Big Impact: Catalyzing Philippine Growth.” Added Rodolfo, “So for the next three years, we are foreseeing that there will be a greater focus on three of these sectors, number one on mining and mineral processing. number two on Data Centers that are AI-led and number three on semiconductors and electronics,” added Rodolfo. The BOI official explained to reporters on the sidelines of the forum that geopolitics triggered the need to prioritize attracting investments into the semiconductor and electronics sector while the Mining Fiscal Regime would See “Mineral,” A2
KIDNEY CARE GETS A MAJOR BOOST President Ferdinand R. Marcos Jr. visits the National Kidney and Transplant Institute (NKTI) on
Thursday, June 19, 2025, to attend the launch of PhilHealth’s Z-Benefit Package for Post-Kidney Transplantation Services. Dubbed “Bagong Kidney, Bagong Buhay,” the program provides comprehensive support for adult and pediatric patients with Stage 5 chronic kidney disease, aiming to expand access to post-transplant care and improve patient outcomes. With the President (from left) are DOH Secretary Dr. Ted Herbosa, PhilHealth President Dr. Edwin Mercado, and NKTI Executive Director Dr. Jose Dante P. Dator. See story in A3 Economy, “Marcos to PhilHealth: Cover meds, tests of kidney transplant patients.” NONOY LACZA
RESIDENT Ferdinand Marcos Jr. has continued reforming his Cabinet with the removal of three more executive officials and the retention of six heads of governmentowned and -controlled corporations (GOCC). In a press briefing in Malacañang on Thursday, Palace Press Officer Claire Castro announced the chief executive has accepted the courtesy resignation of the Presidential Legislative Liaison Office (PLLO) Secretary Mark L. Mendoza, Presidential Adviser on Military and Police Affairs Roman A. Felix, and Philippine National Oil Company Renewable Corporation Director John J. Arenas. The President, she said, opted to retain Government Service Insurance System (GSIS) President and General Manager Jose Arnulfo “Wick” A. Veloso; Land Bank of the Philippines President and CEO Lynette V. Ortiz; Development Bank of the Philippines (DBP) President and CEO Michael O. de Jesus; National Irrigation Administration (NIA) Administrator Eduardo Eddie G. Guillen; Philippine Charity Sweepstakes Office (PCSO) General Manager Melquiades “Mel” A. Robles and Philippine Health Insurance Corporation (PhilHealth) President and CEO Emmanuel “Edwin” Mercado. This was the fourth batch of changes in the Cabinet announced by the Palace since President Ferdinand Marcos ordered members of this Cabinet and heads of GOCCs to submit their courtesy resignations on 22 May 2025 so they can undergo performance assessment. The last list of retained and removed Cabinet members was released on June 3, 2025. On Tuesday, the Palace announced Marcos reappointed Presidential Communication Office (PCO) Secretary Jay Ruiz and Department of Information and Communications Technology (DICT) Secretary Henry R. Aguda, but it was in relation to the Commission on Appointments (CA) bypassing their confirmation and not because of the performance review. Marcos said the review aims to remove underperforming and corrupt members of his Cabinet. “It’s just proof that there is an evaluation of every work done by the heads of agencies and other leaders, and our president should trust them,” Castro said. Almost all of the main members of the Cabinet were retained by the President and only a few are still undergoing evaluation, including Special Assistant to the President Antonio Ernesto F. Lagdameo, Jr. and Office of the Presidential Adviser on Peace, Reconciliation and Unity Carlito G. Galvez. Castro said Malacañang will announce more changes in government in the coming days. “The evaluation is still ongoing and you can expect more names to be included among those who may be retained or removed,” she said.
PESO EXCHANGE RATES n US 56.8360 n JAPAN 0.3919 n UK 76.3137 n HK 7.2412 n CHINA 7.9049 n SINGAPORE 44.2407 n AUSTRALIA 36.9775 n EU 65.2705 n KOREA 0.0415 n SAUDI ARABIA 15.1494 Source: BSP (June 19, 2025)