This is very alarming. If this happens, millions of OFWs would lose income from exchange rates worth 19 billion x 10 or roughly 190 to 200 billion pesos per year. This would certainly reduce consumption rates and would affect, seriously, the Philippine economy. The impact could get worse when our exporters closes shop because of this low exchange rates...this would translate to millions of job losses and miserable life to many Filipinos.
Calling Pres. Aquino and the BSP! Do something that would dampen the Peso value to somewhere around 50 pesos to the dollar.
Here is the news:
By Doris Dumlao. PDI
MANILA, Philippines—British banking giant HSBC sees the peso surging to 37.50 against the US dollar this year and further to 35.50 next year as the Bangko Sentral ng Pilipinas likely leans on a stronger currency to combat rising inflation across Asia.
But some monetary tightening is nevertheless needed—"the earlier the better"—as a preemptive measure against the structural increase in inflation linked to Asia's robust growth, visiting HSBC economist Frederic Neumann said at a press briefing Wednesday.
The Hong Kong-based economist projected that the Bangko Sentral ng Pilipinas' overnight borrowing rate would rise from a record-low 4 percent to at least 4.5 percent through this year and further to 5.25 percent next year or for a total of 125 basis-point hike through 2012.
Neumann, a managing director and co-head of HSBC's Asian economic research, projected that the BSP would start its cycle of rate tightening this year with a quarter-percentage hike during its policy rate setting on May, to be followed by a similar rate hike by the third quarter.
But he said if the BSP could start its tightening during its next meeting next month, it would be better as the Philippines was now the only emerging market that has not raised key interest rates since a tightening cycle started across Asia and the Pacific late last year.
Calling Pres. Aquino and the BSP! Do something that would dampen the Peso value to somewhere around 50 pesos to the dollar.
Here is the news:
By Doris Dumlao. PDI
MANILA, Philippines—British banking giant HSBC sees the peso surging to 37.50 against the US dollar this year and further to 35.50 next year as the Bangko Sentral ng Pilipinas likely leans on a stronger currency to combat rising inflation across Asia.
But some monetary tightening is nevertheless needed—"the earlier the better"—as a preemptive measure against the structural increase in inflation linked to Asia's robust growth, visiting HSBC economist Frederic Neumann said at a press briefing Wednesday.
The Hong Kong-based economist projected that the Bangko Sentral ng Pilipinas' overnight borrowing rate would rise from a record-low 4 percent to at least 4.5 percent through this year and further to 5.25 percent next year or for a total of 125 basis-point hike through 2012.
Neumann, a managing director and co-head of HSBC's Asian economic research, projected that the BSP would start its cycle of rate tightening this year with a quarter-percentage hike during its policy rate setting on May, to be followed by a similar rate hike by the third quarter.
But he said if the BSP could start its tightening during its next meeting next month, it would be better as the Philippines was now the only emerging market that has not raised key interest rates since a tightening cycle started across Asia and the Pacific late last year.