Philippines to intervene more forcefully in streaks of weak peso

THE Philippine central bank is intervening more forcefully during periods of extended peso weakness as part of a new strategy, gradually moving away from day-to-day intervention, Bangko Sentral ng Pilipinas (BSP) Governor Eli M. Remolona, Jr. said.

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The BSP adopted a new formula that determines the magnitude of peso losses that require stronger intervention to curb price pressures, Mr. Remolona said in an interview Tuesday. He declined to elaborate on the formula.

“We worry when there’s a whole streak of peso depreciation,” Mr. Remolona said at his office in Manila. “It leads to inflation and then we start to worry, and then we might intervene more forcefully.”

The peso reversed its losses and strengthened as much as 0.4% to 57.41 per dollar following the central bank chief’s comments, outperforming other Asian currencies.