THE PESO returned to the P52-per-dollar level on Wednesday, its best in three months, as the market digested the results US mid-term elections and positioned ahead of third-quarter economic growth data to be released today.
The local currency closed at P52.95 against the greenback yesterday, strengthening from its P53.025 close on Tuesday.
This was the peso’s best finish since the P52.85-per-dollar recorded on August 6.
The peso strengthened immediately to open the session at P52.93, and climbed to as high as P52.89 versus the greenback. Its worst showing for the day was at P53.11.
The volume of dollars traded surged to $1.45 billion yesterday from $983.78 million the previous trading day.
A trader said the market was volatile yesterday amid the results of the US mid-term elections.
“It was a pretty volatile session, with moves primarily driven by the US mid-term elections. We saw a lot of movement in the dollar overall,” a trader said in a phone interview yesterday. “It was mildly dollar-negative with the Democrats winning the House and the Republicans winning the Senate. We’re still seeing the dollar hold, I would see it will continue overnight.”
Another trader meanwhile attributed the stronger peso to profit taking ahead of the local central bank’s possible tightening at its policy meeting next week.
“The local currency might continue to appreciate due to expectations of likely optimistic Q3 GDP (gross domestic product) growth data. Exchange rates are likely to move within P52.85 and P53.05 range,” the second trader added.
A BusinessWorld poll yielded a 6.3% median forecast for third quarter GDP growth, slower than the seven percent climb posted in July-September last year.— EJCT