1. WHO’SAFRAIDOFA WEAKPESO? Nadine Lopez | Rachel Mendoza | Lois Santiago

2. EXCHANG ERATE THE PRICE OF ONE CURRENCY IN TERMS OF ANOTHER EX. P43 PER $1

3. Pesoapprecia tion RISE IN PESO VALUE IN TERMS OF DOLLARS 43php per usd >>>>>> 40php per usd PESO strengthens Pesodepreciati on FALL IN PESO VALUE IN TERMS OF DOLLARS 43php per usd >>>>>> 45php per usd Peso weakens

4. ■ when real exchange rate ( e ) rises, Foreign goods become relatively expensive, Thus Imports fall Local goods appear cheaper, thus exports rises ∴ net export rises

5. Graph of ■ nx( e ) the higher the e, the higher the nx NX= v + ze e NX

6. KEYNE SIAN ■ a higher e also increases output the increase in net exports increases expenditure and ∴ increases y CROS S Y Exp Y=E E = c(y-t) + i( r ) + G + NX ( e 0 ) E’ = c(y-t) + i( r ) + G + NX ( e 1 )

7. Becauseof Pesodepreciatio n… 2014’s borrowings 2013’s borrowings Php 715 billion Php 735 billion <

8. plannedfinancin g Mixthisyearis… 13% foreign sources 87% DOMESTIC SOURCES Php 95 b EXTERNALLY Php 620 b internally

9. Budgetsensitivityto macroeconomicpara meters

10. Whypolicymakerss houlD Peso depreciation reduces budget deficit Lower financial losses or slight financial gains NotfearTHEWEA KERPESO fiscal authorities monetary authorities (bsp)

11. Why___arebigwin ners Whenpesoisweak Workers in manufacturing and agriculture Greater opportunity to find better and more decent jobs Families of ofws Their remittances will increase In peso terms, they can consume and invest more

12. POLICYRECOMM ENDATIONS ■ develop the export industry and attempt import substitution by increasing productivity (determine difficulties faced and figure out ways to solve them) Maximize the benefits of peso depreciation

13. POLICYRECOMM ENDATIONS ■ conduct financial literacy programs to ofws and their families in order for their remittances to be put into good use ■ regulate monetary expansion if there is a drastic peso appreciation to protect ofws Maximize the benefits of peso depreciation

14. conclusion ■ policymakers should not be afraid of a weak peso comments ■ a weak peso is not enough to boost the philippine economy