THE PESO strengthened further against the dollar on Wednesday as market players waited for the results of the US central bank’s policy meeting.

The local unit closed the session yesterday at P51.89 against the greenback, 10 centavos stronger than the P51.99-per-dollar finish on Tuesday.

The peso traded in a tight range, opening the session stronger at P51.85 versus the dollar. It climbed to a high of P51.83, while its intraday low stood at P51.945.

Trading volume rose to $902.45 million from the $763.9 million that switched hands the previous session.

A trader said the peso moved sideways yesterday due to the policy meeting of the US Federal Reserve.

“We didn’t see much volatility in the market. We just traded sideways with nothing really to move the dollar-peso,” the trader said in a phone interview.

The Fed’s policy-making Federal Open Market Committee is widely seen to keep benchmark rates steady during its June 18-19 meeting, although the central bank is seen to trim its interest rates sometime this year.

Another trader said the peso continued to strengthen amid heightened expectations of a dovish Fed after European Central Bank President Mario Draghi said policy rates in the Eurozone might be reduced if inflation remains steadily low.

Meanwhile, the first trader said the peso traded stronger in the offshore market Tuesday night amid increased risk appetite, driven by the positive news on US-China trade relations.

“That affected the market overnight. With that, we saw risk on sentiment across almost all financial markets overnight,” the first trader said. “That would be good for the emerging markets such as the Philippines.”

For today, the first trader expects the peso to move between P51.65 and P52.05 versus the dollar, while the other gave a tighter P51.80-P52 range. — KANV

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