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PHP: Following US Yields, Better Trade Deficit Doesn't Lift Sentiment

PHP
EM BulletPhilippinesBulletAPACEmerging Market News

USD/PHP sits off session highs, last near 58.55/60 (highs were at 58.62, fresh for 2025). PHP is off around 0.30% at this stage. Broadly though the pair maintains ranges of the high 57 to 59.00 region, which have held in recent months. The pair is now back above all key EMAs though. 

  • The pair is in sync with US yield shifts, like other pairs in South East Asia. Some slowing in the rise of the real 10yr US yield may be helping temper USD/PHP upside, albeit at the margins.
  • Local equities are still struggling for meaningful upside, while offshore investors remain net sellers of local shares.
  • Earlier data showed a better than expected trade deficit of -$4.76bn, compared to -$5.45bn forecast. Both exports and imports were weaker, export growth falling to -8.7%y/y, while imports fell to -4.9%y/y.
  • The trade deficit is in from recent wides (close to -$6bn) but its improvement has lagged the better terms of trade backdrop experienced by the economy. This will remain a headwind for PHP, particularly in an elevated US yield environment.
  • Looking ahead, we have bank lending figures tomorrow, then remittances data next week. 

 

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USD/PHP sits off session highs, last near 58.55/60 (highs were at 58.62, fresh for 2025). PHP is off around 0.30% at this stage. Broadly though the pair maintains ranges of the high 57 to 59.00 region, which have held in recent months. The pair is now back above all key EMAs though. 

  • The pair is in sync with US yield shifts, like other pairs in South East Asia. Some slowing in the rise of the real 10yr US yield may be helping temper USD/PHP upside, albeit at the margins.
  • Local equities are still struggling for meaningful upside, while offshore investors remain net sellers of local shares.
  • Earlier data showed a better than expected trade deficit of -$4.76bn, compared to -$5.45bn forecast. Both exports and imports were weaker, export growth falling to -8.7%y/y, while imports fell to -4.9%y/y.
  • The trade deficit is in from recent wides (close to -$6bn) but its improvement has lagged the better terms of trade backdrop experienced by the economy. This will remain a headwind for PHP, particularly in an elevated US yield environment.
  • Looking ahead, we have bank lending figures tomorrow, then remittances data next week.