Editing by Nathaniel Cajuday
The Bangko Sentral ng Pilipinas (BSP) has called for companies and firms to acquire their dollar requirements from legitimate sources, to prevent adding more volatility to the foreign exchange market. This follows the current value of the peso to the dollar at 60 pesos. As of writing, the peso-to-dollar exchange rate is at 58.74.
“We ask those who have the means not to take undue advantage of changing market conditions. This does not help the Philippine peso; it does not help the Philippines. What we can do is to bring all transactions into an organized and accessible formal market that offers consumer protection,” expressed the BSP.
In a statement, the central bank noted that monetary authorities are taking steps to manage any disruption in the financial market brought about by the continued strengthening of the dollar versus the peso, adding that it looks forward to servicing legal dollar transactions.
“The US dollar spot market remains open and active while forwards and repos are available facilities. All of these can move the economy forward by supporting the financial leg underpinning economic activity and allowing for an orderly settlement of USD obligations. This puts the Filipino in a better position,” the BSP stated.
Last October 3, hit an all-time low of 59 to $1–a depreciation of 15.7 percent–from the end-2021 level of 50.999. This crash made the peso one of the worst-performing currencies in the region.
“There are many reasons why financial markets worldwide have been experiencing notable changes thus far in 2022. Among the pronounced developments is a strong dollar, which is causing currencies like the Philippine peso to depreciate,” the Central Bank stressed.
Following this, the country’s monetary authority also highlighted that the “market conditions around the world are challenging.”
“Working together allows us to sustain our functioning financial market while appropriately managing the developing risks,” it clarified.
Earlier, BSP Governor Felipe Medalla told Bloomberg Television that the central bank would be more active in the foreign exchange market to balance out the volatility of the peso against the dollar.
On the other hand, BSP Director Mhel Plabasan, recently stated that stablecoins are a plausible solution for more efficient payment transactions in the Philippines. Stablecoins are a type of cryptocurrency that is pegged with fiat, or can also be gold, at a 1:1 ratio. (Read more: BSP Director: Stablecoins Can Make Payments More Efficient)
Digital assets, however, are still not properly regulated in the country as the BSP still seeks regulatory provisions from the legislation. (Read more: BSP Seeks Passage of Digital Asset Law)
This article is published on BitPinas: BSP: Buy Dollars from Legit Sources
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