Philippine Peso Plunges Past P60 to Dollar Amid Middle East Tensions
The Philippine peso sank to P60.1 against the US dollar on Thursday, March 19, 2026, as ongoing tensions in the Middle East continue to drive global oil prices higher. This significant depreciation marks a critical threshold for the currency, with experts warning that further weakening could be on the horizon depending on the evolution of the conflict involving Iran.
Business Leader Warns of Prolonged Pressure
According to prominent business leader and entrepreneur Steven Yu, the peso's slide past the 60-per-dollar level may persist or intensify based on developments in the Iran war. "The peso to dollar rate has pierced the 60 level and this may largely hold or weaken further depending on the progress of the Iran war," Yu stated. He highlighted that the US dollar has emerged as the biggest beneficiary since the conflict began, with US stocks and bonds also demonstrating stronger-than-expected performance. This divergence has placed immense pressure on emerging market currencies, including the Philippine peso.
Yu, who is engaged in the trading and distribution business, emphasized that a prolonged conflict would keep the peso under significant strain. The Philippines is grappling with rising oil prices and higher costs for imported goods, exacerbating the economic challenges. "As the war drags on, the peso will remain weak, having to cope with higher prices of oil and other imported supplies," he explained.
Impact on Consumers and Businesses
The depreciation is expected to severely erode consumer purchasing power while simultaneously increasing operating costs for businesses. Yu warned that companies are navigating a difficult environment characterized by rising expenses and slowing demand. "This will be an extremely challenging time for consumers and businesses as consumer purchasing power is significantly impacted," he said. "Businesses are faced with multiple headwinds characterized by increasing operational costs and slowing demand."
Compounding these issues is the critical challenge of securing fuel supply amid global disruptions. Yu noted, "The supply of fuel remains critical, and the government is exerting their best effort to procure from other sources. However, sources like South America entail very high shipment costs. And with this urgent need, we are in a vulnerable position to accept higher costs." He stressed that while maintaining supply continuity is essential, it comes at a steep price. "Expensive fuel is better than no fuel. But the inflationary impact is devastating to businesses and consumers," he added.
Sector-Specific Consequences and Strategic Responses
Yu pointed out that some companies may be forced into difficult decisions as a result of these pressures. "Some sectors will be faced with the decision to either shut down to conserve resources or continue operating at a loss," he said. He urged both households and firms to adopt more conservative financial strategies to weather the storm. "Consumers and businesses will need to significantly tighten their belts and find alternative methods to stay afloat," he advised.
The impact will vary across different sectors of the economy. The information technology-business process outsourcing (IT-BPM) industry could benefit from a stronger dollar, as revenues are largely dollar-denominated. Meanwhile, export-oriented industries may experience mixed outcomes. "As to BPMs, the strong dollar will be beneficial to the sector. The effects on the export sector will vary across industries," Yu explained. "While the strong dollar is a positive to the sector, the changing dynamics of world demand and raw material availability will determine their final predicament."
Broader Economic Implications and Volatility
Yu also flagged potential risks to overseas Filipino worker (OFW) remittances if Middle Eastern economies slow down due to the conflict. "As the Middle East economies ground to a halt, OFW remittances will also be affected," he cautioned. Given these multifaceted factors, Yu warned that the Philippine economy could face heightened volatility in the coming months. "With all these, the Philippine economy is in for a roller coaster volatility and will be the most affected country in Southeast Asia," he concluded.
