Market & Mainstreet
Trade Gap Widens to $31.4B While DOE Warns Fuel Stays High Through Christmas
The Daily Scan – September 23, 2026 (Wed)
The country’s trade deficit widened to $31.36 billion in the first half, revised PSA data showed, as imports grew faster than exports. The DOE said fuel prices will likely stay above prewar levels through Christmas, even as oil itself eased for a fifth straight day on reports Iran may reopen the Strait of Hormuz. That hope helped the peso firm to P62.72, though the PSEi fell for a third straight session to a four-month low. Economists now see the BSP hiking again in October, possibly twice more this year. Abroad, Trump told the UN he faces a “big decision” on Iran while his son-in-law quietly met Iranian officials on the sidelines, and Xi Jinping lands in Washington Thursday for a summit that could decide whether US-China tariffs stay capped past November.
| USD to PHP | H1 trade deficit | PSEi |
| P62.72 | $31.36B | 5,814.56, down 0.50% |
SECTION 1 · Philippines
● Trade deficit widens to $31.4 billion as imports outrun exports
WHAT HAPPENED
Revised Philippine Statistics Authority data showed the first-half trade deficit widened to $31.36 billion, wider than the initial $30.81 billion estimate and well above the $24.48 billion gap a year ago. Imports were revised up to $78.14 billion, 18.8% higher than a year earlier. Exports were also revised up, to $46.78 billion, a 13.2% year-on-year rise.
UNCERTAIN
Analysts cited by BusinessWorld attributed the wider gap partly to the peso’s depreciation, which makes exports more competitive but raises the cost of imports, and to faster growth in electronics and fuel imports specifically.
WHY IT MATTERS
Exports actually grew at a healthy double-digit pace. The problem is imports, driven higher by electronics and fuel, grew even faster. A widening gap like this is a country-level version of a business whose sales are rising while its costs rise faster still.
RISK
A structurally wider trade gap keeps pressure on the peso, which raises costs for anyone who imports inputs or equipment.
OPPORTUNITY
Export growth of 13.2% shows real external demand for Philippine goods is still there.
NEXT MOVE
If you sell abroad, this is a reminder that a weaker peso helps your competitiveness. If you import, treat currency risk as a live cost line, not a one-time shock.
● DOE says fuel prices will stay elevated through Christmas
WHAT HAPPENED
Energy Secretary Sharon Garin told reporters that domestic fuel prices are unlikely to ease back to prewar levels within the year because of the ongoing Middle East conflict and a stronger dollar. She said prices will “probably stay elevated until Christmas” unless the parties in the conflict reach a peaceful agreement. This came as the DOE formally certified that the 30-day average price of Dubai crude breached the $80-a-barrel threshold that triggers a possible fuel excise tax freeze or cut.
UNCERTAIN
Garin said the DOE has certified the trigger was met, but the actual decision on an excise tax freeze or cut rests with the Development Budget Coordination Committee, which still needs to weigh the inflation and economic impact before recommending anything to the President.
WHY IT MATTERS
This is the clearest official statement yet that relief is not coming soon. Any business planning around a return to pre-2026 fuel costs this year should recalibrate.
RISK
“Elevated until Christmas” is now the government’s own base case, not just a trader’s guess.
OPPORTUNITY
The DBCC review of an excise tax freeze is active and could still soften the blow on LPG and kerosene specifically.
NEXT MOVE
Build your Q4 budget around today’s fuel prices, not a hoped-for decline. Treat any DBCC excise relief as upside, not a plan.
● Peso firms to P62.72 even as PSEi falls to a four-month low
WHAT HAPPENED
The peso strengthened to close at P62.72 on Tuesday, up from P62.78 on Monday, as traders cited hopes for diplomatic progress on the Middle East war during the UN General Assembly in New York. The PSEi, however, fell 0.50%, or 29.23 points, to 5,814.56, its third straight losing session and its worst finish since June 1. Analysts pointed to concerns over weaker third-quarter growth and still-elevated fuel prices weighing on the index even as the currency improved.
UNCERTAIN
A trader told BusinessWorld the peso could keep rising Wednesday on hopes for easing US-China trade tensions ahead of Thursday’s Trump-Xi summit, with a forecast range of P62.60 to P62.85.
WHY IT MATTERS
The peso and the stock market are telling two different stories right now: currency traders are pricing in diplomatic optimism, while equity investors are more worried about domestic growth and costs.
RISK
A falling PSEi despite peso strength suggests investors see slower growth ahead regardless of how the Middle East story resolves.
OPPORTUNITY
A firmer peso, even a temporary one, is a small break on import costs if it holds through your next order.
NEXT MOVE
If you have a dollar payment due this week, today’s P62.70-ish range is better than last week’s P63 territory. Consider locking it in rather than waiting.
● Economists see the BSP hiking again in October, and maybe twice more this year
WHAT HAPPENED
University of Asia and the Pacific economist Marco Antonio Agonia told BusinessWorld he expects the BSP to raise rates by 25 basis points at its October meeting, with two hikes possible before year-end. He cited the recent minimum wage increase, the Fed’s own tightening, and food price pressure from a potential “Super El Niño” as the key drivers. He estimated the wage hike alone could add 0.1 to 0.4 percentage point to inflation.
UNCERTAIN
This is one economist’s forecast, not a BSP announcement. The BSP has said inflation will likely peak in the fourth quarter, with the full-year print potentially reaching 6.1%.
WHY IT MATTERS
The interest rate differential between the BSP and the Fed already widened to 100 to 125 basis points after last week’s Fed hike. If the BSP follows with its own hikes, business loan rates are likely to follow.
RISK
Two more hikes this year would make new borrowing meaningfully more expensive heading into 2027.
OPPORTUNITY
A clear rate path, even a rising one, is easier to plan around than uncertainty.
NEXT MOVE
If a loan or credit line is on your radar for Q4, price it assuming at least one more BSP hike, and lock in terms sooner rather than later.
SECTION 2 · Worth Knowing
● Oil falls to $99 as Iran signals it may reopen the Strait of Hormuz
WHAT HAPPENED
Brent crude fell to $99 a barrel on Tuesday, its fifth straight losing session and lowest in two weeks. Japan’s Kyodo News reported that Tehran proposed reopening the Strait of Hormuz within seven days if the US lifted its blockade of Iranian ports, a potential opening for talks during the UN General Assembly. Saudi Arabia also began preparing to restart its damaged East-West pipeline, with exports potentially resuming later this week.
UNCERTAIN
A proposal reported by a single outlet is not a confirmed deal. Both the Hormuz reopening and the Saudi pipeline restart remain unconfirmed as operational realities.
WHY IT MATTERS
Two of the biggest supply disruptions behind this month’s fuel price hikes, the Hormuz blockade and the Saudi pipeline damage, both showed signs of easing on the same day. That is the most encouraging combination for oil prices in weeks.
RISK
Reported proposals have fallen through before in this conflict.
OPPORTUNITY
Five straight days of falling oil, if it holds through this week’s benchmark window, points toward a lighter fuel price adjustment next Tuesday.
NEXT MOVE
Watch Wednesday and Thursday’s oil prices closely. If the decline holds, next week’s DOE fuel adjustment could be the first real relief since August.
● Trump tells the UN he faces a “big decision” on Iran, as his envoys hold quiet talks on the sidelines
WHAT HAPPENED
In his UN General Assembly address Tuesday, President Trump said he faces a choice between striking a deal with Iran or moving to “annihilate” the country, and predicted a deal would come “right after the election,” referring to the US midterms. Separately, he said his son-in-law Jared Kushner and envoy Steve Witkoff met with Iranian officials on the sidelines of the UN gathering and had “a very good meeting.”
UNCERTAIN
Trump has backed off major threats against Iran at least eight times since the war began, according to reporting cited by ABC News. No details of what Kushner and Witkoff discussed were released.
WHY IT MATTERS
The public rhetoric and the private diplomacy appear to be running on separate tracks. Markets, including the peso, reacted to the quieter signal of talks happening at all, not to the public ultimatum.
RISK
Trump’s own team does not expect a deal before the November US midterms, which is still weeks away.
OPPORTUNITY
Active back-channel talks, even without a public breakthrough, are a better sign than none.
NEXT MOVE
Don’t price your fuel or currency planning off headline statements alone. The market moved on the quieter meeting, not the public threat.
● Xi lands in Washington Thursday for a summit that could decide the tariff truce’s fate
WHAT HAPPENED
President Trump and Chinese President Xi Jinping meet Thursday, Sept. 24, at the White House, Xi’s first visit to US soil since 2015. The 2025 Busan tariff truce expires Nov. 10, and both sides face pressure to extend it. The agenda includes a roughly $30 billion “non-sensitive” goods basket under discussion, AI governance, critical minerals, and Taiwan.
UNCERTAIN
Analysts told the World Economic Forum the summit is expected to stabilize the current trade détente rather than deliver a sweeping new deal. Whether Chinese business executives accompany Xi, seen as a signal of commercial momentum, was still unconfirmed as of this writing.
WHY IT MATTERS
An extended truce keeps a lid on tariffs that ripple through Asian supply chains Philippine importers and exporters sit inside. A failure to extend it would do the opposite.
RISK
If Thursday produces no signal on extending the truce, expect market anxiety to build toward the Nov. 10 deadline.
OPPORTUNITY
Both sides have strong incentives to avoid a re-escalation, which raises the odds of at least a limited extension.
NEXT MOVE
If your business touches US or China trade, treat Thursday as a checkpoint, not a resolution. Have a plan for both an extended truce and a lapsed one by Nov. 10.
SECTION 3 · THE OPPORTUNITY BEHIND THE NEWS
The government just told you not to wait for fuel relief this year.
Two numbers from the past day point the same direction. The trade deficit widened to $31.36 billion in the first half, driven partly by pricier fuel imports. And the DOE, in plain language, said domestic fuel prices will probably stay elevated through Christmas.
Put together, this is about as clear a signal as a business owner gets. The widening import bill and the DOE’s own statement are both describing the same condition: this is not a temporary spike waiting to reverse. It is the operating environment for the rest of 2026.
The opportunity in that clarity is real, even if the news itself is not good. A cost you can name and plan for is easier to manage than one you are hoping will disappear. Businesses that build their Q4 numbers around today’s elevated fuel and import costs, rather than a hoped-for decline, will be the ones not caught flat-footed if the DBCC’s excise tax review does not move fast enough to matter this quarter.
SECTION 4 · FOUNDER’S LESSON
Revenue growth means nothing if your costs grow faster.
Look past the headline number in today’s trade data. The trade deficit widening to $31.36 billion sounds like bad news, and in aggregate, it is. But look at what is actually happening underneath: exports grew 13.2% year on year. That is a genuinely strong number. The problem is imports grew 18.8%, outpacing it.
This is a pattern every founder should recognize, because it happens inside businesses all the time. Sales are up. The owner feels good. Then the bank balance tells a different story, because costs, supplier prices, shipping, labor, quietly grew faster than the sales did. Revenue growth got all the attention. Margin did the actual damage.
The fix is not to stop growing exports, or stop growing sales. It is to watch the gap, not just the top line. A country tracks this as a trade deficit. A business tracks it as gross margin. Either way, the number that matters is not how much came in. It is what was left after what went out.
SECTION 5 · ONE REAL SIGNAL
Two supply chokepoints eased on the same day. That is worth watching closely this week.
Most weeks this year, oil news has been about new disruptions. Tuesday was different. Two separate chokepoints behind this year’s fuel price surge both showed signs of loosening within hours of each other.
| $99 | 7 days | P62.72 |
| Brent’s Tuesday close, fifth straight losing session and a two-week low | Timeframe Iran reportedly proposed to reopen the Strait of Hormuz if the US lifts its blockade | Peso’s Tuesday close, its first gain in three sessions |
First, Japan’s Kyodo News reported Tehran proposed reopening the Strait of Hormuz within seven days if the US lifted its blockade on Iranian ports, a possible opening for talks during this week’s UN gathering. Second, Saudi Arabia began preparing to restart its East-West pipeline, damaged in a drone attack earlier this month, with exports potentially resuming within days.
Neither is confirmed. Both are proposals and preparations, not completed facts. But the market treated them as meaningful: oil fell for a fifth straight day, and the peso posted its first gain in three sessions on hopes for diplomatic progress, even as Trump’s own UN speech kept the public rhetoric sharp.
Our read: this is not a signal that the crisis is over. Trump himself does not expect a deal before the US midterms. But it is the first time in weeks that two separate supply threats eased at once instead of one easing while another worsened. If both hold through this week, the benchmark window that sets next Tuesday’s Philippine fuel prices would catch the decline for the first time since August.
What to watch next: whether Saudi exports actually resume this week, and whether Thursday’s Trump-Xi summit adds a second source of good news or reintroduces fresh uncertainty.
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Summarized in our own words with links to every source. We don’t reproduce full articles or bypass paywalls. Interpretation is labeled as such and kept separate from reported fact.
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