The peso and the dollar: why the exchange rate reaches every Filipino household

On September 14, 2026, the peso closed at ₱62.86 to the US dollar, the weakest finish on record, BusinessWorld reported. It was one of more than twenty record lows this year. The first came on January 7, at ₱59.355, according to GMA News, and the peso passed ₱60 in March, ₱61 a month later and ₱62 on August 28, Rappler reported. On October 6 it closed at ₱62.771.

For comparison, the old record was ₱59, first reached in October 2022 and matched in November 2024, The Manila Times reported.

Who sets the rate

Nobody sets it by decree. The Bangko Sentral ng Pilipinas leaves the exchange rate to market forces: the price of the dollar in pesos is determined by supply and demand among banks, its primer explains. The closing rates in the news come from the Bankers Association of the Philippines, whose daily benchmark is a volume-weighted average of the morning's dollar trades between member banks.

The BSP does step in, but only to temper sharp swings. It does not try to reverse the trend. BSP Governor Eli Remolona Jr. told senators that the central bank can smooth sharp moves, but that holding the peso at a fixed level would burn through the country's reserves, Rappler reported. Those reserves stood at $104.8 billion at the end of August, enough for about 6.8 months of imports.

Why it matters at home

The Philippines buys fuel, food, machinery and raw materials priced in dollars, Rappler noted. When the peso weakens, those imports cost more in pesos. The BSP's primer gives the simplest example: at ₱50 to the dollar, a dollar's worth of gasoline costs ₱50; at ₱40, it costs ₱40.

The effect shows up at the pump. In early September the Department of Energy said the peso's slide of about 68 centavos against the dollar, together with the Iran war, produced that week's fuel price increases, BusinessWorld reported. Read more in our explainer on how pump prices are set.

Prices overall are rising fast. Inflation reached 7.2 percent in September 2026, up from 6.1 percent in August and the highest since March 2023, BusinessWorld reported, well above the BSP's target of 2 to 4 percent. The central bank has raised its policy rate by 75 basis points since April, to 5 percent.

Winners and losers

Families of overseas Filipino workers receive more pesos for every dollar sent home. Remittances matter: cash sent by overseas Filipinos reached a record $35.63 billion in 2025, equal to 7.3 percent of the economy, according to BSP data reported by Philstar. The United States was the largest source, followed by Singapore and Saudi Arabia, and the BSP expects $36.6 billion this year.

But the gain is not clean. Higher prices of fuel, food and transport eat into what a weaker peso adds to a remittance, Rappler noted. Households without a relative abroad get only the higher prices.

What to watch

The rate moves every working day. Our Economy today page shows the peso against the dollar and other currencies OFWs earn in, with a 120-day chart, and our Facebook pages post the rate on working days.