VICE President Leni Robredo said Wednesday that she and President Rodrigo Duterte must be careful, because everything they say “is a matter of policy.”
Should the President seek her advice, she said, she would suggest he tone down his statements.
“We have personal thoughts that need not be mentioned in public because of our positions,” she said. “[It’s] the same with the President.”
She said it would help if government officials think before they speak, adding that the President’s tough statements against the international community could drive away potential donors and contributors to the government’s anti-poverty programs.
“We expect so much help coming from them (foreign donors) and each incident could strain our relations with them. Just like the others, I am one with everyone also wishing the situation does not worsen,” she said.
The President’s tough talk could also hurt the peso, which could fall to more than 50 to a US dollar, Fitch Ratings’ BMI Research said in a report released Wednesday.
BMI said the peso’s weakness last month was due to the “deteriorating investor sentiment” after Duterte criticized the US for speaking out against his bloody war on drugs.
The peso’s weakest level this year was recorded on Sept. 30 at 48.50 to a dollar. This was a seven-year low since September 2009 at the height of the global financial crisis.
“In the event that these fears translate into something more tangible leading to prolonged political uncertainty, we believe that a further slide of the peso beyond 50 to US dollar could be likely,” BMI said.
It further said that a selloff in the Chinese yuan and an expected interest rates hike by the US Federal Reserve before the year ends could trigger “broad-based emerging currency weakness” that will affect the peso.
The peso on Wednesday closed at 48.285, P0.04 lower than 48.245 a day ago.
Offering a contrasting view, ING Bank Manila senior economist Joey Cuyegkeng said the peso would not depreciate too much this year because of the country’s solid macroeconomic fundamentals.
But Cuyegkeng revised his previous peso exchange rate forecast per dollar by yearend to around 47.50 from 46.60, taking into consideration the volatility in the financial markets.