The lowdown on the Philippine peso
Way back in the pre-Hispanic Philippines, gold was plentiful and was used for bartering and trading with neighbouring islands. When the Spanish arrived in 1521, they thoughtfully brought their own coins along with them. The four reals silver coin, known as the teston, became the unit of trade and was known locally as salapi, which simply meant ‘money’ in Tagalog. With the establishment of Manila in 1574, the Spanish introduced the eight real silver coin, otherwise known as the peso.
With coins coming from all over the Spanish world with different purities and weights for the same coins, there was a lot of monetary confusion going around the Philippines. In 1857, the introduction of decimalization and the peso fuerte or ‘strong peso’ put an end to all that and by 1897, the Spanish government was minting money especially for use in the Philippines, known simply as the Spanish-Filipino peso. This didn’t last long, however, with the capture by the US and introduction of the US-Philippine peso in 1904 – pegged at exactly half the US dollar – until Philippine independence and the opening of the Central Bank of the Philippines on January 3 1949.
By 1964, the bullion worth of old silver pesos meant that the coins were worth almost twelve times their face value. Filipinos began hoarding them instead of handing them over to the government, where they’d only get face value for their coins. This led to the demonetization of the the old silver coins and the introduction of the peso as a floating currency – it’s been a floating currency ever since.
A look back at US dollar to Philippine peso rates
During the 1950s, the Philippine peso exchanged at a rate of 2 Philippine pesos to 1 US dollar. In 1965, the floating rate was abolished and the peso began to devalue, trading at around ₱11 per $1 in 1983, ₱20 in 1986 and ₱28 in the early 1990s. The 1997 Asian financial crisis saw the peso devalue even further to 40 per dollar in 1998 and ₱50 by the year 2000.
The Philippine peso over the last 10 years
Between 2006 and 2008, the peso fell steadily to ₱40.34 to $1 by February 2008, its lowest rate for the last ten years. It had risen again to 49.42 by the end of the year, steadily declining to 40.6 by February 2013. It has averaged at around ₱45 to $1 for the last two years.
