(Bloomberg) -- The Philippine peso dropped to the lowest level in almost three years ahead of the Federal Reserve policy meeting and as the presidential election approaches.
The peso fell as much as 0.3% to 52.505 per dollar on Wednesday, the weakest since August 2019. The Fed is expected to raise rates by 50 basis points on Wednesday, something it hasn't done since May 2000. The Philippines is set to hold elections on May 9.
“The upcoming election is likely adding to concerns among market players,” said Nicholas Mapa, a senior economist at ING Groep NV in Manila. “There is already general anxiety ahead of the all-important Fed policy meeting, especially if the Fed sounds more hawkish.”
Read: Fed Traders Are Seeking an Answer to the 75-Basis-Point Question
Asian currencies took a hit this quarter as the prospect of a more hawkish Fed sapped demand for risk assets. The upcoming Philippine election is also weighing on the peso amid uncertainty on policy changes.
Former Senator Ferdinand “Bongbong” Marcos Jr. retained his lead in the presidential race while his closest rival, Vice President Leni Robredo, remained a distant second, according to the latest survey by pollster Pulse Asia Research Inc.
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