THE PESO strengthened to a one-month high on Tuesday as the dollar weakened due to lower-than-expected US retail data and negative sentiment at Wall Street.
The local currency ended Tuesday’s session at P53.96 versus the greenback, 12 centavos stronger than the P54.08-per-dollar finish the previous day.
This was the peso’s best showing in more than a month or since it closed at P53.94 versus the dollar on Sept. 11.
The peso opened the session stronger at P54.03 per US currency, strengthening to its best showing of P53.96, which was yesterday’s closing rate. Its intraday low, on the other hand, was at P54.09 against the greenback.
Trading volume climbed to $777.8 million from the $528.9 million that switched hands the previous session.
A trader said the peso ended stronger as it reflected the weaker dollar overnight due to the weak US retail sales report.
The US Commerce Department reported on Monday that retail sales barely rose in September as a rebound in motor vehicle purchases was offset by a drop in restaurant and bar spending, Reuters reported.
“Intraday, we saw the peso [weaken] to P54.09 as the dollar bounced back in Asia,” the trader added, noting the peso recovered to close at its intraday high “further aggravated by foreign selling.”
Meanwhile, Rizal Commercial Banking Corp. economist Michael L. Ricafort said the dollar declined recently against major currencies after the US stock markets dropped to two- to three-month lows.
“Decline in global crude oil prices to three-week lows, which was down by more than $5 from the highs, also supported the latest gains in the peso as this would reduce the country’s oil import bill as well as narrow the trade deficit,” Mr. Ricafort added.
Ruben Carlo O. Asuncion, chief economist at UnionBank of the Philippines, said the peso has been strengthening since the local central bank hiked its interest rates.
“It seems that the general perception about inflation is that the peak has already been reached,” Mr. Asuncion said in a text message.
For Wednesday, he expects the peso to trade between P53.70 and P54, while the trader gave a P53.90-P54.10 range. — Karl Angelo N. Vidal

RELATED ARTICLESMORE FROM AUTHOR