Peso up to P58.62, GIR down 1.5% to $106.84B

On Tuesday, the Philippine peso closed at P58.62 to the US dollar, slightly higher than Monday’s close of P58.7.

Fitch Solutions' BMI Research expects the peso to trade between P55.20 and P59.20 this year, reflecting uncertainty around President Donald Trump's economic policies.

The latest data from the Bangko Sentral ng Pilipinas (BSP) showed a 1.5% drop in gross international reserves (GIR) to $106.84 billion at end-December from $108.49 billion at end-November, confirming central bank intervention to arrest currency decline.

With Trump's return to the White House and proposed policies like import tariffs, tax cuts, and tighter immigration measures, economies around the world are bracing for potential inflationary pressures, which will keep the dollar strong.

BMI Research expects the BSP to deliver 75 basis points worth of rate cuts this year as the US Federal Reserve continues its easing cycle.