SGD/PHP Outlook:
The SGD/PHP rate is slightly weaker, likely to move sideways. Currently, it is near its 3-month average and trading close to recent lows.
Key drivers:
• Rate gap: The Singapore Monetary Authority has maintained a stable monetary policy, while the Bangko Sentral ng Pilipinas explores new strategies, causing varying impacts on their respective currencies.
• Risk/commodities: Oil prices have remained stable, supporting regional currencies like the PHP, although external factors may still affect their overall strength.
• One macro factor: The Philippine economy has faced challenges, notably political and fiscal risks, potentially impacting investor confidence and the peso's performance.
Range:
SGD/PHP is expected to hold within its recent stable range, showing little movement beyond 44.96 to 46.81.
What could change it:
• Upside risk: A significant improvement in economic indicators or a positive shift in trade relations for Singapore could boost the SGD.
• Downside risk: Continued political instability or deterioration of fiscal conditions in the Philippines may further pressure the peso.