GBP/PHP Outlook:
The GBP/PHP outlook is likely to decrease as the rate is trading near recent lows, about 2.3% below its 3-month average. Current political uncertainty in the UK adds pressure on the British Pound.
Key drivers:
• Rate gap: The Bank of England is considering interest rate cuts to tackle slowing growth, while the Bangko Sentral ng Pilipinas has continued its easing cycle.
• Risk/commodities: The ongoing volatility in global markets can further weigh on the GBP if investor confidence wavers.
• One macro factor: Recent corruption scandals in the Philippines raise concerns, impacting fiscal management and potentially affecting the peso's value.
Range:
Expect GBP/PHP to test the lower end of its recent 5.7% range, with potential for continued fluctuations.
What could change it:
• Upside risk: A surprise hawkish turn from the Bank of England could support the GBP.
• Downside risk: Further political instability in the UK may deepen depreciation pressure on the GBP.