Peso's strong showing defies new Trump tariffs

With the Philippine peso emerging as an outperformer among Asian currencies following the United States’ (US) tariff hike, Japanese financial giant MUFG has maintained its forecast that the local currency will continue to strengthen in the fourth quarter of 2025 through next year.

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Last Friday, the peso stayed at P56.47 against the US dollar, closing the week at the same rate as last Thursday. This was despite the local currency hitting an intraday high of P55.49, a brief return to the P55:$1 level, according to the Bankers Association of the Philippines (BAP). It reached an intraday low of P56.55, which was also its opening rate. Total trading volume declined to $1.225 billion from Thursday's $1.389 billion.

Singapore-based United Overseas Bank (UOB) argued that despite the Philippines receiving a higher 20-percent US tariff, relative to the previous 17 percent, the peso was still "the outperformer in the region."

This strength was “possibly because the economy is relatively more insulated from tariff impacts given a lower export reliance while the Philippines also received a relatively lower tariff rate compared to most ASEAN [Association of Southeast Asian Nations] economies,” said Quek Ser Leang and Peter Chia, UOB senior technical strategist and senior foreign exchange (forex) strategist, respectively.