Over the past 2 years, the Philippine currency, the Piso, has been strengthening against the weak U.S. dollar, as have pretty much all currencies in the world. The Piso had historically been at around 55 to the dollar, but in a short period of time, it had strengthened to almost 40 to the dollar... a more-than-25-percent gain. That doesn't mean much to the average American or Filipino citizen, but for American and Filipino citizens earning money in dollars, but living on Pisos (like myself), this has meant a 25-percent reduction in income: For every $1,000 I earn, I am only receiving $750 worth of pisos (based on the prior price); $250 of every $1,000 is simply gone.
Anyway, over the past month, the Piso has been experiencing a bit of a turnaround. It hit a low of about 40.2 to the dollar, had a quick rebound, and then has started creeping slowly (but very steadily) back upwards into less-strong territory, and now is hovering at 42.3 to the dollar.
However, at this point in time, it is really too early to declare an end to the strong Piso, and breathe a sigh of relief that the worst is finally over: Historically, over the past 5 years, major advances in the value of the Piso tend to occur after a brief climb similar to what is being seen now.
Additionally, not all Asian currencies are relfecting this rebound: The Thai Baht, Malaysian Ringgit, Indonesian Rupiah, and Chinese Yuan are all holding steady value (or advancing) against the dollar, while the Japanese Yen, Korean Won, Vietnamese Dong, and Indian Rupee are reflecting a small bounce similar to the Piso's. With the major Asian currencies evenly split on whether the dollar has been strengthening or not over the past 30 to 50 days, that makes the certainty of a full-blown turnaround even more vague.
Somebody the other day at lunch said that he had heard that we could expect the Piso to reach 50 to the dollar by the end of this year. I think that is definitely overly optimistic. But, I would make this prediction: If the Piso manages to cross back over the 45-Piso-per-dollar mark, it would probably be safe to breathe a sigh of relief that we won't be seeing a Piso valued below 40 to the dollar anytime soon.
Whether the Piso will weaken further upward from that 45 barrier, hold or start to advance again really is anybody's guess. My guess would be that with the Olympics coming up in August, the American elections in November, the nations coming together to address the food crisis, and the beginning of the end of the Iraq occupation, it is a time of optimism and positive emotions in the world, and that should benefit the dollar.