Job gains by industry
THE Philippines’ unemployment rate unexpectedly rose year on year in November 2025 despite the start of the holiday hiring season, as bad weather and job losses in key industries outweighed the usual fourth-quarter lift, data from the Philippine Statistics Authority (PSA) showed. Read the full story.
Jobless losses by industry
THE Philippines’ unemployment rate unexpectedly rose year on year in November 2025 despite the start of the holiday hiring season, as bad weather and job losses in key industries outweighed the usual fourth-quarter lift, data from the Philippine Statistics Authority (PSA) showed. Read the full story.
Philippine jobless rate climbs despite holiday hiring
By Erika Mae P. Sinaking
THE Philippines’ unemployment rate unexpectedly rose year on year in November 2025 despite the start of the holiday hiring season, as bad weather and job losses in key industries outweighed the usual fourth-quarter lift, data from the Philippine Statistics Authority (PSA) showed.
Preliminary results of the Labor Force Survey (LFS) put the jobless rate at 4.4% in November, up from 3.2% a year earlier, though lower than 5% in October. This translated to about 2.25 million jobless Filipinos, compared with 1.66 million in November 2024 and 2.54 million in the previous month.
Labor Secretary Bienvenido E. Laguesma said the November figures were unexpected given the seasonal pattern of stronger hiring toward the yearend.
“Yes, I am surprised because, as you pointed out, ‘ber’ months are associated with increased hiring. Note, however, that the November 2025 stats are better than the October 2025 figures indicating recovery,” he told BusinessWorld.
National Statistician and PSA Undersecretary Claire Dennis S. Mapa said the year-on-year weakening in the jobs market reflected weather-related disruptions and employment declines across several major sectors.
“[There were] two major typhoons in November last year, including Tinio, and their impact was widespread,” he told a news briefing on Wednesday. He noted that the storms disrupted economic activity, transport and supply chains, affecting hiring and job retention across regions.
In the first 11 months of 2025, the unemployment rate averaged 4.19%, higher than the 3.9% average recorded in the same period in 2024.
The November employment data also showed mixed signals. The number of employed Filipinos rose to 49.26 million in November from 48.62 million in October, pointing to some seasonal recovery.
However, employment remained below the 49.54 million recorded in November 2024, underscoring the lingering effects of disruptions earlier in the year.
As a result, the employment rate slipped to 95.6% in November from 96.8% a year earlier, though slightly better than 95% in October.
Mr. Mapa said the typical hiring boost during the “ber months” was weaker than expected. He noted that there were 49.26 million employed people in November 2025, 277,000 fewer than a year earlier.
The impact was most visible in sectors sensitive to mobility, such as tourism and logistics.
The average employment rate for the first 11 months of 2025 stood at 95.8%, lower than the level recorded in the comparable period in 2024.
UNDEREMPLOYMENT
Data from the PSA showed underemployment rate fell to 10.4% in November from 10.8% in November 2024 and 12% in October. This was the lowest underemployment rate in nine months or since 10.1% in February.
The ranks of underemployed Filipinos — those who want longer work hours or an additional job — dropped to 5.11 million in November from 5.35 million a year earlier and 5.81 million in October.
Year to date, the average underemployment rate stood at 12.26%, inching up from 12% a year earlier.
Labor force participation rate rose to 64% in November from 63.6% in October but slipped from 64.6% a year earlier. This translated to a labor force of 51.52 million in November, higher than the 51.16 million in October and 51.2 million in No-vember 2024.
PSA data showed job losses were concentrated in industries directly affected by adverse weather conditions and weaker consumer activity in November.
Accommodation and food service activities had the largest year-on-year decline, shedding 309,000 jobs. Losses were concentrated on restaurants and mobile food service activities, which cut 191,000 positions, followed by short-term accommodation activities with a reduction of 76,000 jobs, and event catering services, which declined by 23,000.
Wholesale and retail trade, including the repair of motor vehicles and motorcycles, also saw jobs drop by 258,000 year on year.
Employment declines were also recorded in retail sales in stalls and markets dealing in food, beverages, and tobacco, as well as buyer stalls and motor vehicle sales. Other service activities shed 250,000 jobs, driven largely by cuts in personal wellness services and domestic services.
Jobs in manufacturing fell by 150,000, reflecting continued weakness in the sector. Mr. Mapa said the semiconductor and electronics sector, in particular, lost 106,000 jobs year on year in November.
He said that manufacturing of other food products and the processing and preserving of fruits and vegetables also posted notable job losses, partly due to supply-chain disruptions and reduced operating days following the typhoons.
“These sectors — accommodation and food service activities, wholesale and retail trade, other service activities, and manufacturing — contributed to the decline in the number of employed persons, which in turn pushed unemployment higher year on year,” Mr. Mapa said.
Some sectors, however, recorded employment gains. Public administration and defense, including compulsory social security, added 185,000 jobs year on year, while education employment increased by 176,000, partly reflecting continued hiring in government and public institutions.
BETTER IN DECEMBER?
Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., told BusinessWorld that the relatively higher unemployment rate in November was “partly due to the series of typhoons, storms, flooding that led to weather-related disruptions that reduced business days, sales, incomes for some businesses, consumers, and other institutions.”
For Chinabank Research, the decline in manufacturing jobs, particularly those in the production of semiconductors and other electronic components, reflected the impact of recent typhoons on business operations.
“Looking ahead, the sector continues to face risks from the challenging external environment, though a pickup in domestic demand could help support factory activity and improve job prospects,” it said.
Chinabank Research said it expects holiday demand in December to have provided support to employment and consumption at the end of 2025.
“December might show better data with stronger holiday-driven demand, though this seasonal boost will likely wane this month. This year, we expect the labor market to remain generally robust and support a recovery in consumption growth,” it added.
Mr. Ricafort said the labor market may have improved in December 2025 amid peak seasonal demand, better weather conditions, and increased economic activity.
“Nevertheless, unemployment rate at 3%-4% levels is still considered among the best in about 20 years or since revised records started in 2005,” he said.
Mr. Ricafort also pointed to the government’s planned catch-up spending in 2026, anchored on governance reforms and anti-corruption measures, as a potential boost to investor confidence, economic growth, and employment going forward.
In a statement, the Department of Economy, Planning, and Development (DEPDev) said the latest LFS results underscore the need to strengthen workforce competitiveness and business resilience amid persistent disruptions.
“The government is prioritizing investments in skills development, lifelong learning, and social protection systems to enable workers to transition across sectors and withstand economic shocks. Strengthening workforce competitiveness is one of the key elements to attract investments that generate quality jobs,” DEPDev Secretary Arsenio M. Balisacan said in a statement.
For his part, Mr. Laguesma said the Department of Labor and Employment, in collaboration with the private sector, will ramp up efforts to come up with “better employment results” in the coming months.
Philippine jobless rate at 4.4% in November
THE Philippines’ unemployment rate unexpectedly rose year on year in November 2025 despite the start of the holiday hiring season, as bad weather and job losses in key industries outweighed the usual fourth-quarter lift, data from the Philippine Statistics Authority (PSA) showed. Read the full story.
Peso slides to fresh record low of P59.355 per dollar
By Aaron Michael C. Sy, Reporter
THE PESO fell to a fresh record low against the dollar on Wednesday amid dovish signals from the Philippine central bank.
The local unit closed at P59.355 versus the greenback, declining by 14.5 centavos from its P59.21 finish on Tuesday, data from the Bankers Association of the Philippines showed.
It surpassed its previous record low of P59.22 logged on Dec. 9, 2025.
The peso opened Wednesday’s trading session weaker at P59.24 versus the dollar. Its intraday best was at P59.20, while its weakest showing was at P59.38 against the greenback.
Dollars traded declined to $1.317 billion on Wednesday from $1.386 billion on Tuesday.
Fresh signals from the Bangko Sentral ng Pilipinas (BSP) of a potential rate cut next month weighed on the local unit, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.
“The peso weakened anew after the BSP signaled a potential rate cut in February which could further narrow domestic and US rate differentials,” another trader likewise said in an e-mail.
BSP Governor Eli M. Remolona, Jr. said on Tuesday that a rate cut at its Feb. 19 meeting remains on the table amid “reasonably low” December inflation and below-target economic growth last year.
“I can say that we’re very close to where we want to be in terms of policy… There’s a chance that we may cut some more, and there’s also a chance that we may not move at all. But there’s not a lot of probability that we will raise in 2026,” he said.
Mr. Remolona also said the BSP would only intervene in the foreign exchange market if the peso’s depreciation is “sharp enough” to impact inflation.
“The peso is under pressure following the dovish Bangko Sentral ng Pilipinas comments and the relatively relaxed stance on its recent depreciation trend,” Wee Khoon Chong, a senior APAC market strategist at BNY, was quoted as saying in a Bloomberg News report.
Bloomberg reported that Mr. Remolona declined to comment on Wednesday when asked whether the BSP is intervening in the currency market to support the peso and if he sees it breaching P60 against the dollar.
Lower growth prospects, weakening current-account balance and deterioration of investor sentiment are all weighing on the peso in the short term, Mr. Chong said.
The local unit may have also weakened due to a knee-jerk reaction by investors following the US attack on Venezuela, Reyes Tacandong & Co. Senior Adviser Jonathan L. Ravelas said in a Viber message.
“The dollar-peso closed higher as market sentiment continued to sour amid geopolitical concerns following the US attack on Venezuela,” a trader likewise said by telephone.
For Thursday, the first trader said the market could remain cautious as it awaits US labor data and hopes for intervention by the central bank. “Upside may remain sluggish,” the trader said.
The first trader sees the peso moving between P59.10 and P59.50 per dollar on Thursday, while both the second trader and Mr. Ricafort expect it to range from P59.20 to P59.45.
Mr. Ravelas sees the local unit moving between P59 and 59.30 per dollar. — with Bloomberg News
NG debt inches up to record-high P17.65T
THE PHILIPPINES’ total outstanding debt inched up to a fresh high of P17.65 trillion as of end-November, the Bureau of the Treasury (BTr) said.
Latest data from the Treasury showed that the National Government’s (NG) outstanding debt went up by 0.49% to P17.65 trillion in November from P17.56 trillion at end-October 2025.
The debt level is already 1.7% above the projected year-end level of P17.36 trillion.
November also marked the fifth month in a row that the end-2025 debt projection was breached.
Year on year, NG debt jumped by 9.94% from P16.05 trillion at the end of November 2024.
“The month-on-month increase was underpinned by the net issuance of domestic and external debt, which was partly offset by significantly lower valuations of foreign currency-denominated obligations due to the peso’s appreciation,” the BTr said in a statement on Wednesday.
The peso appreciated against the US dollar from P58.771 at the end of October to P58.729 at the end of November 2025.
NG debt is the total amount owed by the Philippine government to creditors, including international financial institutions, development partner countries, banks, global bondholders, and other investors.
In November, the bulk or 68.66% of the debt stock came from domestic sources, while the rest came from external sources.
The BTr said it continues to borrow mainly from domestic creditors and in local currency to keep debt levels “sustainable.”
“This is because peso obligations do not fluctuate with foreign exchange rates and the payment of interest redounds to the benefit of Filipino investors, further boosting domestic income,” it said.
Domestic debt inched up by 0.6% to P12.12 trillion as of end-November from P12.05 trillion as of end-October. This is mainly composed of government securities.
At end-November, debt was already 0.6% higher than the P12.04-trillion year-end domestic debt projection.
“This (increase) was driven by the P71.85 billion in net issuance of government securities, despite a P0.12-billion reduction in peso valuation on retail dollar bonds,” the BTr said.
Since the start of 2025, domestic debt jumped by 10.86% or P1.19 trillion. Of this, P1.18 trillion came from fresh issuances and P2.52 billion “was caused by the weakening of the peso from its level at the end of 2024.”
Year on year, domestic debt rose by 10.95% from P10.92 trillion recorded in November 2024.
Meanwhile, external debt stood at P5.53 trillion as of end-November, up 0.26% from P5.52 trillion in the previous month. This also exceeded the P5.32-trillion external debt projection by 4.07%.
“This is due to the P22.84 billion in net loan availment for the month, which was offset by the P8.73 billion in downward valuation adjustments caused by favorable foreign exchange movements,” the Treasury said.
The BTr noted that the stronger peso against the US dollar trimmed foreign currency debt valuation by P3.94 billion. At the same time, third-currency movements, such as the Japanese yen and the euro, contributed another P4.79 billion to the valuation cut.
Year on year, foreign debt climbed by 7.81% from P5.13 trillion in 2024.
Foreign debt was composed mainly of P2.82 trillion in global bonds and P2.71 trillion in loans.
External debt securities totaled P2.39 trillion in US dollar bonds, P258.77 billion in euro bonds, P58.73 billion in Islamic certificates, P57.01 billion in Japanese yen bonds, and P54.77 billion in peso global bonds.
“The NG’s external financing operations remained prudent, measured, and anchored on long-term debt sustainability considerations,” the BTr said.
“External borrowings continue to be largely concessional and program-based, offering very long maturity terms and relatively lower interest costs, thereby supporting a cost-effective and resilient debt profile.”
Since the start of the year, NG external debt jumped by 8.01% or P410.04 billion.
“Of the total, P276 billion was due to new loans and bonds, while P134.04 billion was net adjustments to valuation linked to peso depreciation against foreign currencies in the first eleven months of 2025,” it added.
For November, NG-guaranteed obligations increased by 3.38% to P356.04 billion from the end-October level of P344.41 billion.
The BTr attributed the monthly increase to the net availment of domestic guarantees by the Power Sector Assets and Liabilities Management Corp., amounting to P12.71 billion.
However, external guaranteed repayments and favorable exchange rate movements tempered the increase by P0.42 billion and P0.66 billion, respectively, it added.
Year on year, NG-guaranteed obligations fell by 15.64% from P422.03 billion.
WAKE-UP CALL
Jonathan L. Ravelas, a senior adviser at Reyes Tacandong & Co., said the record-high debt is a “wake-up call.”
“The challenge now is balancing fiscal discipline with growth,” he said in a Viber message.
Mr. Ravelas also urged the government to accelerate infrastructure and investment projects that generate jobs and revenue, while keeping borrowing focused on productive spending.
“Otherwise, higher debt means higher interest costs — and less room to maneuver,” he said.
Meanwhile, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said that the higher debt stock in November partly reflected new government securities issued to cover the wider fiscal gap in recent months.
The budget deficit swelled to P1.26 trillion as of end-November from the P1.18-billion deficit in the same period in 2024.
“The weaker peso exchange rate vs. the US dollar over the past 3.5 years by about 16% effectively increased the peso equivalent of the outstanding National Government external debts when converted to pesos,” he said in a Viber message.
Asked if the government would be able to bring down debt to P17.36-trillion programmed level, he said: “Already beyond the target, with possible budget deficits still in December 2025.”
Meanwhile, Mr. Ravelas said a weaker peso and failure to address the country’s issues would inflate the debt in 2026.
NG debt as a share of gross domestic product (GDP) went up to 63.1% at end-September from 60.1% in the same period last year. This is above the 60% threshold deemed sustainable for developing countries.
The Department of Finance expects the NG debt-to-GDP ratio to ease to 61.3% by end-2025 and eventually fall to 58% by 2030. — Aubrey Rose A. Inosante
BoC falls short of full-year target in 2025
By Aubrey Rose A. Inosante, Reporter
THE BUREAU of Customs (BoC) on Wednesday said revenue collections rose to P934.4 billion in 2025 but missed its P958.7-billion full-year target, amid a rice import ban and weak import volumes.
In a statement on Wednesday, the BoC said it booked P934.4 billion in revenues in 2025, up 1.9% or P17.726 billion from the P916.7-billion actual collection in 2024.
However, Customs’ full-year collection was 2.53% below its P958.7-billion target.
This marked the second consecutive year that it missed its annual revenue goal.
“This growth was achieved despite the challenges including the lower import volumes, the suspension of rice importation, and global commodity price fluctuations,” BoC said.
The government banned rice imports from September to December, as it sought to protect farmers during the harvest season.
“(The year) 2025 was more than numbers or milestones — it was a year that showed the Bureau of Customs can transform, proving that integrity, service, and trust are not just ideals, but values we put into action every single day,” BoC Commissioner Ariel F. Nepomuceno said in a statement.
Mr. Nepomuceno had earlier flagged slower import activity and corruption scandals as risks to the collection target.
The Development Budget Coordination Committee (DBCC) is now targeting Customs revenues to reach P1.013.8 trillion, P1.072.5 trillion in 2027, and P1.139.9 trillion in 2028.
“Every reform, every operation, every decision we make is about changing the way the public experiences the BoC. As we step into 2026, our mission is clear: to make the Bureau faster, more transparent, and genuinely reliable, and to build an institution that earns the confidence and respect of every Filipino,” Mr. Nepomuceno said.
In addition, the BoC said that border protection remained a core priority last year, as it ramped up efforts to prevent the entry of prohibited, misdeclared, and undervalued goods.
Preliminary data showed that the Customs seized smuggled and prohibited goods worth P61.71 billion from 1,024 enforcement operations in 2025.
The agency noted that the outcomes demonstrated enhanced intelligence coordination, more effective risk assessment, and closer partnerships with law enforcement and regulatory authorities.
“The Bureau also continued to improve oversight of bonded warehouses and expanded the use of non-intrusive inspection technologies to ensure regulatory compliance while minimizing disruption to legitimate trade,” the BoC said.
The BoC also instituted reforms such as the “No Take” policy, the issuance of an Anti-Conflict of Interest directive, and the launch of the “Isumbong kay Commissioner” online portal.
Other initiatives include the rollout of the enhanced Customs tax estimator, revisions to the Code of Conduct and the Citizens’ Charter, and the establishment of the Balikbayan and Overseas Filipino Worker Action Center.
“Looking ahead, BoC remains committed to sustaining these reforms, deepening partnerships, and harnessing digital innovations to further enhance efficiency and public service,” it said.
Analysts said Customs revenue collection could rebound in 2026 but may face challenges arising from weak economic growth and a continued rice import ban.
“Short-term recovery in collections in 2026 is possible if import volumes pick up, commodity prices stabilize, and operational efficiency improves,” Ser Percival K. Peña-Reyes, director of the Ateneo Center for Economic Research and Development, said in a Viber message on Wednesday.
Data from the DBCC Technical Working Group showed that Customs revenue collection could reach P1.0038 trillion in 2026, 0.99% below the emerging goal.
“However, persistent policy impacts (especially on rice), external economic headwinds, and structural tariff changes mean that a full return to pre-2025 revenue levels is not guaranteed without policy adjustments or new revenue measures,” Mr. Peña-Reyes said.
Leonardo A. Lanzona, an economics professor at the Ateneo de Manila University, said Customs collections may be affected by slower economic growth momentum.
“With prospects of lower economic growth, imports are likely to decline. In this case, the BoC will also likely miss its target again,” he said in a Messenger chat.
The DBCC now projects gross domestic product growth of 5-6% in 2026, and 5.5-6.5% in 2027, while maintaining the 6-7% target for 2028.
Jonathan L. Ravelas, a senior adviser at Reyes Tacandong & Co., said Customs collections could recover by midyear if there is a rebound in infrastructure spending and consumer demand.
“Customs will face tough headwinds this year — sluggish global trade, peso volatility, and policy uncertainty on key imports like rice and fuel,” he said in a Viber message.
Rockwell Land seeks approval for P10-B bonds
ROCKWELL LAND CORP. has filed a registration statement with the Securities and Exchange Commission (SEC) for a bond issuance of as much as 10 billion, marking its return to the domestic debt market after more than a decade.
In a disclosure to the stock exchange on Wednesday, the company said the offer would consist of three-year bonds due in 2029 and five-year bonds due in 2031. The bonds will have a base amount of P7 billion, with an oversubscription option of as much as P3 billion.
The offer period is scheduled for March 4 to 10, with the bonds to be listed on the Philippine Dealing & Exchange Corp. Rockwell Land said the registration statement was submitted to the SEC via e-mail on Wednesday.
“The bonds are intended to be issued at 100% face value, and interest will be calculated on a 30/360 day count basis to be paid quarterly in arrear,” the company said.
The proposed issuance represents the first tranche of Rockwell Land’s P20-billion shelf registration program and its first bond sale in 12 years.
Philippine Rating Services Corp. assigned the bonds its highest rating of PRS Aaa with a “stable” outlook, citing the company’s extremely strong capacity to meet its financial obligations.
Proceeds from the bond offer will be used to partially fund capital expenditures, including land development and construction costs for projects.
These include Power Plant Mall Angeles in Pampanga; Rockwell at IPI Center and Aruga Mactan Hotel in Cebu City; and Rockwell Center Bacolod.
BDO Capital & Investment Corp. and First Metro Investment Corp. were named joint issue managers. They will also serve as joint lead underwriters and bookrunners alongside PNB Capital and Investment Corp. and RCBC Capital Corp.
Rockwell Land has been expanding its residential and retail footprint nationwide and has launched several premium residential projects in key provincial areas since late 2024.
The company recently acquired a 74.8% stake in Alabang Commercial Corp., the operator of Alabang Town Center in Muntinlupa City.
For the first nine months of 2025, Rockwell Land reported a 7% increase in consolidated revenue to P15 billion, driven by demand for its high-end residential developments.
Shares of Rockwell Land rose 1.06% or 2 centavos to close at P1.90 each on the Philippine Stock Exchange. — Beatriz Marie D. Cruz
PHL media companies brace for tougher 2026
By Ashley Erika O. Jose, Reporter
LISTED media companies in the Philippines are expected to face a more difficult operating environment this year as ad revenues ease after last year’s election-driven surge and as traditional platforms continue to lose ground to digital channels, analysts said.
“It will be a challenging year coming off the 2025 election cycle, when political spending boosted their earnings,” First Grade Finance, Inc. Managing Director Astro C. del Castillo said in a Viber message on Wednesday.
He added that legacy media revenues remain under pressure as advertisers continue shifting budgets to digital platforms.
China Bank Capital Corp. Managing Director Juan Paolo E. Colet said earnings of listed media companies are likely to decline as revenues normalize after the election year. He added that companies might also scale back ad spending amid a more cautious economic backdrop.
The post-election period usually brings weaker advertising demand, Mr. Colet said, noting that companies tend to be more conservative with marketing budgets when growth expectations soften.
GMA Network, Inc. and ABS-CBN Corp. both reported weaker third-quarter results in 2025 as political advertising faded and commercial spending normalized.
For the three months ending September 2025, GMA Network’s gross revenue fell 17.23% to P3.89 billion, partly due to higher operating expenses.
Despite the weaker quarter, the broadcaster posted stronger results for the nine-month period, with attributable net income rising 46.81% to P2.07 billion. Revenue climbed 11.92% to P13.99 billion, while expenses increased at a slower pace.
Advertising remained GMA Network’s main revenue driver, rising 10.47% to P12.77 billion, while consumer sales grew to P1.22 billion from P942.24 million a year earlier.
ABS-CBN, meanwhile, widened its attributable net loss to P1.28 billion in the third quarter from P389.87 million a year earlier, even as revenues rose year on year. For the first nine months, however, the company narrowed its net loss to P2 billion as expenses declined faster than revenue.
Mr. Colet said investors might pay closer attention to ABS-CBN after its content licensing agreement with Villar-led Advanced Media Broadcasting System, Inc. (ALLTV).
Under the deal, selected Kapamilya Channel programs began airing on ALLTV’s free-to-air Channel 2 on Jan. 2.
The agreement followed the termination of ABS-CBN’s content supply deal with TV5 Network, Inc., which said the move stemmed from ABS-CBN’s failure to meet its financial obligations.
“The market may take a closer look at ABS-CBN to see whether its free-to-air Channel 2 deal with ALLTV will help improve cash flows and narrow losses,” Mr. Colet said.
Analysts said digital transformation remains key to stabilizing earnings, though execution risks remain. Mr. Del Castillo said a hybrid strategy that balances traditional broadcasting with digital distribution might help media companies sustain performance by building on their content strengths.
GMA Network has begun upgrading its broadcast operations by shifting its international channels to cloud-based distribution through a partnership with global video technology firm Synamedia Ltd. and its local distributor Telered Technologies and Services Corp.
ABS-CBN has said it expects to return to profitability within 18 months, supported by advertising and contributions from its digital, film and music businesses.
At the local bourse, shares of GMA Network rose 1.07% to P5.65, while ABS-CBN gained 4.57% to close at P4.39 each.
Dollar edges up as focus shifts to data
THE DOLLAR hugged tight ranges on Wednesday ahead of a slew of US economic data that could set the tone for the US Federal Reserve’s rate outlook, a factor traders consider more consequential for currencies than ongoing ge-opolitical tensions.
Markets have so far largely brushed off deepening geopolitical fractures around the world, with stocks rallying and currencies and bonds little moved following the US intervention in Venezuela and the capture of President Nicolas Maduro.
They were in a wait-and-see mode ahead of a batch of US labor market data, with figures on private payrolls and job openings due later in the day, before Friday’s closely watched nonfarm payrolls report comes due.
Ahead of the outcome, the dollar index strengthened slightly to 98.63.
“Traders seem to be okay with the rhetoric coming from the US when it does not imply that ‘boots on the ground’ will be needed to run Venezuela,” said Thierry Wizman, global forex and rates strategist at Macquarie Group.
“A military invasion and a prolonged on-the-ground conflict would have risked a major dollar depreciation, as did the Iraq and Afghanistan wars in 2002-2008,” he added.
Investors have struggled to get an accurate read of the world’s largest economy following a record US government shutdown last year which hampered the collection and release of key economic data.
However, they remain convinced that the Fed will cut rates two more times this year.
That has weighed on the dollar, though growing divisions within the Fed and US President Donald J. Trump’s imminent pick for the next Fed chairman have further complicated the outlook for US monetary policy.
EURO EDGES DOWN AS DATA WEIGH
The euro edged down after falling the previous day, as German inflation slowed more than expected in December, prompting traders to slightly scale back bets on a rate hike in early 2027.
Markets have been pricing policy rates to remain stable through 2026 since last summer, while expecting the European Central Bank to tighten policy in 2027 as inflationary pressures build from German fiscal stimulus.
The single currency was down 0.10% to $1.1676, after falling 0.28% on Tuesday.
Also on traders’ radar, China on Tuesday banned exports of dual-use items to Japan that can be used for military purposes, marking Beijing’s latest move in reaction to an early November remark by Japanese Prime Minister Sanae Takaichi about Taiwan.
The move didn’t impact the forex market, strategists said.
The greenback fell 0.10% against the Japanese yen to 156.51.
The Aussie dollar hit its highest since October 2024 at $0.6766, as a mixed inflation report kept alive the prospect of a near-term hike in interest rates. The New Zealand dollar bought $0.5783.
“The most impactful publication will be ADP’s monthly jobs report, as an uptick in unemployment is one of the significant risks in this new year, alongside the potential failure of heavy investments in AI to deliver blockbuster re-turns,” Jose Torres, senior economist at Interactive Brokers, said of Wednesday’s releases. — Reuters
PCC clears logistics JV of Ayala and EMIF II
THE Philippine Competition Commission (PCC) has approved the proposed joint venture (JV) between Ayala Corp. and EMIF II Holding III B.V., saying the deal is unlikely to significantly reduce competition in the freight and logistics sector.
In a statement on Wednesday, the PCC said both domestic and international freight forwarding markets are highly fragmented, with customers often using multiple providers.
“The market for container liner shipping services is characterized by the presence of numerous global and regional carriers and strong buyer power, which effectively limits any ability or incentive to restrict capacity or degrade service,” it said.
It also noted that contract logistics and container shipping services remain competitive, with strong buyer power and performance-based tenders limiting any incentive to restrict capacity or reduce service quality.
The approval follows a March 2025 agreement in which Denmark-based A.P. Moller Capital, through EMIF II Holding III B.V., agreed to acquire as much as 40% of Ayala’s logistics unit, AC Logistics Holdings Corp., subject to final pricing, regulatory approvals and the achievement of agreed business milestones.
Ayala Corp. said the entry of A.P. Moller Capital, an affiliate of A.P. Moller Holding — the parent of global shipping and logistics giant Maersk — would enhance AC Logistics’ capacity to address growing and more complex logistics demand.
A.P. Moller Capital manages infrastructure funds focused on expanding transport and logistics setups while supporting the energy transition.
Founded in 2021, AC Logistics provides supply chain services including cold chain management, freight forwarding, national distribution, and contract logistics.
It operates a nationwide network of distribution centers and maintains a fleet of temperature-controlled trucks and other transport assets, complemented by an extensive agent network.
The PCC said its review examined markets potentially affected by the transaction, including domestic and international freight forwarding, nationwide contract logistics and container liner shipping for sea freight. The agency’s assessment relied on information from the parties, as well as input from logistics regulators and industry stakeholders.
Shares of Ayala Corp., which operates across real estate, banking, telecommunications, renewable energy, healthcare, mobility and logistics, rose 1.46% to P487.60 each on the Philippine Stock Exchange. — Alexandria Grace C. Magno
Global regulators softening bank capital rules
LONDON/WASHINGTON — Seventeen years on from the global financial crisis, regulators are cutting red tape for their banks in a bid to keep lenders competitive and stimulate their economies.
The Trump administration is leading the charge, including with measures that will reduce the amount of capital lenders need to set aside. Lowering capital requirements is worrying some observers that the US has triggered a global rowback from regulations designed to keep financial systems safer, just as chatter about market bubbles and financial stability risks intensify.
So how do bank capital requirements in the major markets stack up, and which lenders might emerge winners?
THE GLOBAL LANDSCAPE
At the highest level, each country’s regulators should align with the Basel regulatory regime agreed after the 2008 global financial crisis. That’s designed to ensure supervisors worldwide apply similar minimum capital standards so lenders can survive loan losses during tough times. It suggests a level playing field.
But in practice there is lots of wiggle room, as the different approaches to implementing the latest rules — the “Basel III Endgame” — show.
The European Commission and Bank of England (BoE) have delayed implementation of key parts such as those governing banks’ trading activities, while they wait to see what the US does.
THE US VS EUROPE
Capital ratio requirements for banks in the euro zone, Britain and the US look similar on paper.
The Federal Reserve has a core equity tier-1 ratio (CET1) — the most common measure of capital — ranging from 10.9% to 11.8% once some add-ons are included for Wall Street banks such as JPMorgan, Citi and Goldman Sachs.
Lenders in the euro zone such as Deutsche Bank, Santander and BNP Paribas need, on average, to hold a minimum CET1 ratio of 11.2%, according to the European Central Bank (ECB).
The BoE’s financial policy committee last month lowered its system-wide estimate of capital requirements by 1 percentage point (ppt), to an equivalent CET1 ratio of around 11%.
All major lenders hold more capital than required, with these self-imposed buffers designed to keep regulatory worries at bay and investors confident.
BUT CAN YOU COMPARE?
Ask big bank CEOs and most will tell you their lender has it tougher. In reality, the picture is much murkier than that.
That’s because comparing simple ratios can be misleading, as prudential regulators take different approaches, reflecting how their local banking industries differ.
Capital rules have two parts: the risk-weighting, which gauges the risk of a bank’s assets, and a capital ratio that sets how much capital they must hold as a share of those assets.
Unlike in the UK and euro zone, US banks cannot rely on internal models to set their risk weightings, which for larger banks often means tighter constraints.
“Say it quietly, but the US may have a tougher approach,” said Jackie Ineke, chief investment officer at Spring Investments and a former banks analyst.
Higher US weightings also reflect different models: US banks tend to offload residential mortgages to public groups Fannie Mae and Freddie Mac, whereas mortgages stay on European and UK bank balance sheets.
ISN’T THE US SOFTENING ITS STANCE?
Yes.
Bank regulators appointed by President Donald J. Trump are seeking to delay and water down the introduction of new rules, and they are reviewing and rewriting existing capital regulations. They argue there is am-ple room to make them better tailored to actual risks.
Led by the Federal Reserve’s Michelle Bowman, proposals include tweaking leverage rules, the so-called “GSIB (Global Systemically Important Banks) surcharge” applied to the largest global banks, and a redo of Basel III End-game requirements.
The Fed is also overhauling its annual “stress tests” of large banks, a shift expected to shrink the capital banks must set aside against hypothetical losses.
Taken together, it means US lenders will have a lot more excess capital. Morgan Stanley analysts have estimated possible changes could hand US banks another $1 trillion in lending capacity.
That doesn’t mean the banks will necessarily lend more, however, with some preferring to increase payouts to investors to aid their share price or fund acquisitions.
WHERE DOES THAT LEAVE THE EURO ZONE, BRITAIN AND JAPAN?
Both want to ease the burden on banks, but in limited ways that suggest there is no regulatory race to the bottom.
The ECB in December announced plans to simplify its rule book but maintain capital levels. That was despite lobbying from banks arguing that softer rules would free up lending to boost the bloc’s lackluster economic growth.
Jose Manuel Campa, outgoing chairperson of the European Banking Authority, said it was wrong to conclude lower capital demands made lenders more competitive. “Well-capitalized banks are much better at taking lend-ing decisions,” he told Reuters.
The BoE last month cut its headline estimate of system-wide bank capital needs by 1 ppt to 13%, the first move downwards since the financial crisis, and said it would review the leverage ratio, which sets a minimum level of capital banks must hold relative to their total exposures, regardless of asset risk.
Analysts described the changes as important but measured.
In Japan, however, the banking regulator has pushed ahead with implementing the finalized Basel III framework, which went into effect for its three “megabanks” at the end of March 2024. The regulator had pre-viously delayed implementing the rules amid the coronavirus pandemic and war in Ukraine.
MORE TO IT THAN CAPITAL
There is more to the debate than the scale of capital requirements.
In Switzerland, for example, the government wants to toughen the rules on what counts as capital, much to the annoyance of UBS.
Then there are country-specific frameworks like Britain’s ring-fencing regime that requires banks including Barclays and HSBC to capitalize their retail units separately from their investment banking op-erations.
Supervisory enforcement often matters more than headline capital ratios in determining what banks hold, according to economist Enrico Perotti at the University of Amsterdam.
He said this is particularly true in the US, where the latent message under Mr. Trump is “to get regulators off the backs of banks,” showing that what mattered today was “less to do with numbers.” — Reuters