The Philippine peso is positioned to regain strength against the US dollar during the holiday season, backed by substantial inflows from overseas Filipino workers and the country's robust dollar reserves, despite recently touching the 59-level.
Peso Resilience Amid Current Weakness
On Wednesday, November 12, 2025, the Philippine peso weakened to close at 59.17 against the US dollar, reaching levels not seen in recent trading sessions. However, according to Rizal Commercial Banking Corp. chief economist Michael Ricafort, the local currency maintains underlying resilience.
Ricafort highlighted that the peso has demonstrated this pattern before, noting that three years ago the currency similarly reached the 59-level but subsequently recovered significantly, strengthening back to the 57-range against the greenback.
OFW Remittances Provide Seasonal Boost
The anticipated surge in remittances from overseas Filipino workers during the Christmas period is expected to serve as a crucial support mechanism for the local currency. Data from the Bangko Sentral ng Pilipinas confirms that December consistently records the highest remittance inflows each year, with volumes exceeding $3 billion monthly since 2022.
Ricafort explained in his response to Philippine News Agency inquiries on Thursday, November 13, that Christmas-related spending creates compelling reasons for OFWs and other dollar earners to convert their US currency to pesos, especially given the current favorable exchange rates.
Central Bank Intervention and Reserve Strength
The Bangko Sentral ng Pilipinas continues to play an active role in managing currency volatility. Ricafort described BSP's intervention as an effective way to discourage any undue speculation or pressure on the local currency, particularly important when the US dollar becomes relatively expensive for importers and other buyers.
He cautioned that ignoring the BSP factor would be a mistake for those anticipating further dollar strength, pointing to the recent downward correction in the exchange rate to 59.17 as evidence of effective management.
Another fundamental strength supporting the peso is the country's gross international reserves, which reached $109.7 billion by the end of October 2025. This substantial reserve level provides more than seven months of import coverage, significantly exceeding the international benchmark of three to four months.
Ricafort emphasized that these reserves provide sufficient buffer and protection for the local currency against any speculative pressures, creating a solid foundation for stability despite short-term fluctuations in the foreign exchange market.
