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Overseas news
The British pound ended slightly up against the US dollar on Monday after trading with no clear direction. This happened amid expectations for the Bank of England (BoE) to cut the policy rate during its meeting on Thursday.
Lower interest rates make it less costly to borrow money, which may lead to increased borrowing and help boost economic growth and activity.
Rate decisions can also affect the value of a currency because investors are more likely to invest in currencies from countries with higher interest rates.
Local developments
The Philippine Stock Exchange index (PSEi) closed higher on Monday following expectations of further rate cuts by the Bangko Sentral ng Pilipinas (BSP) next year.
Since rate cuts can lead to increased borrowing and spending by consumers and businesses, such moves tend to renew investor interest in stocks.
The Philippine peso also rose against the US dollar on Monday as investors stayed cautious ahead of the release of US employment data this week.
Central banks like the BSP and the US Federal Reserve (the Fed) look at economic data like unemployment figures and the inflation rate when deciding what to do with interest rates.
Meanwhile, remittances from overseas Filipino workers (OFWs) grew by 3% year-on-year in October. According to the BSP, this was slowest pace of growth in 5 months.
Remittances are important to the Philippine economy because the money brought into the country circulates through the financial system and contributes to the gross domestic product (GDP).
Additionally, the Department of Public Works and Highways (DPWH) is seeking to restore P45 billion that was cut from its 2026 budget, warning that slowing construction may weigh on economic growth.
The Senate’s proposed funding bill includes a reduced DPWH budget amid issues of corruption in the department. The ongoing probe has led to a slowdown in government spending and affected growth.
Today’s news is mixed with no strong hints of where markets are headed. It may be best to remain cautious with your investing decisions for now.
