Philippines Central Bank steps back from dollar market intervention, letting the peso find its own floor

The Bangko Sentral ng Pilipinas (BSP) has made a deliberate choice to limit foreign exchange interventions to only the most extreme volatility events, allowing the peso to move where market forces take it. Under Governor Eli Remolona Jr., the Philippine central bank has adopted a framework that steps back from defending its currency during periods of dollar strength. What the BSP is actually doing The shift started taking shape in January 2024, when Remolona announced that a new framework to limit foreign exchange interventions was being finalized. The goal was straightforward: stop burning through reserves to prop up the peso during broad dollar strength, and instead reserve firepower for genuinely disruptive volatility. By January 2026, Remolona described BSP interventions as “minimal.” The peso had drifted toward P60 to P61 per dollar, levels that would have triggered aggressive defense in prior administrations. In remarks from October 2025 that were widely covered heading into 2026, Remolona laid out the logic clearly. The BSP would only step in for “excessively volatile” movements, and even then, the primary concern was mitigating trade disruptions and inflation risks, not def...