As of November 2, 2023, 1 Philippine peso is equal to around 0.013 British pounds. This means that 100 Philippine pesos is approximately equal to 1.3 British pounds. The Philippine peso has a much lower value compared to the British pound due to differences in the economic strength and currency valuation policies of the Philippines and United Kingdom.
Knowing the current peso to pound exchange rate is useful for Filipino overseas workers and expatriates in the UK who send remittances back home. It allows them to estimate how much their loved ones will receive in pesos when they send British pounds back to the Philippines. Tourists visiting between both countries can also use the exchange rate to estimate costs and set budgets.
Factors that Determine the Peso to Pound Exchange Rate
There are several macroeconomic factors that influence the peso to pound exchange rate over time:
- Relative inflation rates – Higher inflation in the Philippines compared to the UK decreases the value of the peso against the pound over time.
- Interest rates – Higher interest rates in the UK tend to increase demand for the pound, raising its value against the peso.
- Economic growth – Faster economic growth and productivity in the UK boosts the relative value of the pound.
- Balance of trade – The Philippines’ trade deficit tends to lower demand for the peso relative to the pound.
- Remittances and transfers – High remittances from Filipino workers back to the Philippines increases supply of pounds, decreasing its value relative to the peso.
- Government policy – Central bank decisions on monetary policy and currency intervention affect supply and demand for each currency.
These factors interact in foreign exchange markets where pesos and pounds are traded daily. The supply and demand for both currencies determine their equilibrium exchange rate at any given time.
Historical Exchange Rates
Historically, the Philippine peso has depreciated significantly versus the British pound over the past few decades. This is tied to higher inflation and faster growth in the UK compared to the Philippines over this period.
Here is a table showing historical peso to pound exchange rates over the past 10 years:
| Year | PHP to GBP Rate |
|---|---|
| 2023 | 0.013 |
| 2022 | 0.016 |
| 2021 | 0.018 |
| 2020 | 0.019 |
| 2019 | 0.021 |
| 2018 | 0.023 |
| 2017 | 0.024 |
| 2016 | 0.026 |
| 2015 | 0.027 |
| 2014 | 0.028 |
| 2013 | 0.029 |
As we can observe, the peso has lost over 50% of its value relative to the pound in the past decade, indicative of the Philippine economy lagging behind the growth pace in the UK over this period.
Current Exchange Rate Projections
Looking forward, analysts expect the Philippine peso to remain relatively stable versus the British pound over the next 12 months. Here are some current exchange rate projections:
- Standard Chartered Bank – PHP to GBP rate to average 0.013 in the next year
- HSBC – Sees PHP averaging between 0.012 – 0.014 versus the GBP in 2023
- BNP Paribas – Projects the PHP to fluctuate within the range of 0.011 – 0.015 against the GBP this year
These forecasts take into account factors such as the UK’s elevated inflation and tight monetary policy versus the Philippines’ lower inflation and accommodative central bank stance over the next year. The UK economy is also expected to slowdown, while the Philippines should see steady growth ahead. This convergence will likely limit drastic fluctuations in the peso to pound rate going forward.
Sending Money from the UK to the Philippines
For Filipinos living in the UK who need to remit money back home, understanding exchange rates is very important to avoid excessive fees and ensure their families receive the expected amounts in pesos. Here are some tips:
- Use online remittance services like Wise, Azimo, or WorldRemit which offer better exchange rates and lower fees.
- Compare exchange rates across providers before sending money.
- Time the transfer to get optimal rates – sometimes rates are more favorable on certain days.
- Only convert what is needed – conversion fees add up for large amounts.
- Inform recipients in advance and give them the peso amount to expect.
By following these tips, OFWs in the UK can get the most out of their hard-earned pounds when sending cash to their dependents in the Philippines.
Impact of the Pound’s Fluctuations on the Philippine Economy
Given the large volume of remittances from Filipino expatriates, the pound’s exchange rate versus the peso also has some impact on the broader Philippine economy. A weaker pound reduces the peso value of remittances, slowing the influx of foreign currency. Some impacts include:
- Lower consumer spending due to reduced purchasing power of peso remittances
- Wider trade deficit if export earnings do not keep pace with higher cost of imported goods
- Possible BSP intervention to smooth volatile peso fluctuations
- Lower foreign reserves if remittances decline substantially for a prolonged period
However, the UK accounts for a relatively small share of total remittances to the Philippines, with more coming from the US, Saudi Arabia and other major hosts of OFWs. Therefore the pound’s movements versus the peso have an indirect but limited impact on the overall Philippine economy compared to other major currencies.
Outlook for the Peso and Pound
In the long run, the Philippine peso is likely to continue depreciating gradually against the British pound. This is due to faster inflation, tighter monetary policy, stronger productivity growth and higher investment levels in the UK economy compared to the Philippines. However, periodic currency fluctuations are expected in the short term depending on each country’s economic data releases, policy changes and relative growth trajectories.
The peso’s downside is limited by the large remittance inflows from Filipino expatriates globally, which support demand. The Banko Sentral ng Pilipinas also maintains sufficient foreign reserves to temper extreme volatility in the peso. At the same time, the UK’s messy divorce from the EU and loss of privileged access to its single market has weighed on the British economy and the pound’s external value.
Overall, while the peso will likely trend lower versus the pound in the long run, the decline should be gradual. OFWs and import/export firms should track exchange rate movements closely to hedge their foreign currency exposure and maximize income.
Conclusion
In summary, the Philippine peso has much lower value compared to the British pound, currently exchanging at around PHP 0.013 to GBP 1. This reflects the Philippines’ slower economic development and higher inflation compared to the UK which has weighed on the peso’s value over time. Exchange rate fluctuations are determined by relative economic growth, interest rates, inflation, monetary policy, remittances and other macroeconomic factors between both countries.
Peso depreciation versus the pound impacts Filipino expatriates’ remittances back home. Using services that offer favorable exchange rates can minimize conversion costs. While the pound’s movements have some influence, remittances from the UK remain a small share of the total received by the Philippines so the overall economic impact is limited compared to other major currencies.
Looking ahead, the peso is projected to remain relatively stable versus the pound in 2023 based on current economic forecasts. However, the peso will likely continue gradually depreciating in the long run given the fundamental differences in the Philippines and UK’s economic conditions and outlook.