THE PESO may decline as the market looks for hints from the US central bank.

THE PESO will likely end on a weaker note today after the release of the minutes of the US Federal Reserve’s July policy meeting.

On Tuesday, the local unit finished at P52.29 versus the greenback, climbing two centavos from its P52.31-per-dollar close on Monday, after the US government granted Huawei Technologies Co., Ltd. another 90-day extension to buy American-made components to service its existing customers.

Local financial markets were closed on Wednesday in observance of Ninoy Aquino day.

“The local currency might weaken [today] amid expectations of dovish cues from the minutes of the July Fed meeting,” a trader said via e-mail.

Aside from the July Fed minutes release, another trader said: “All eyes will be on manufacturing PMIs [today] both in the US and in the euro zone,” referring to the manufacturing purchasing managers’ index that measures business condition’s improvement or deterioration.

Minutes from the Federal Open Market Committee’s most recent meeting in July, when the US central bank cut rates for the first time since the 2008 financial crisis, are due on Wednesday.

“The minutes are going to set up a foundation of what to expect, and then Jackson Hole will provide clarity as to whether the Fed is finally coming to the party with potential monetary policy support,” said IG Markets analyst Kyle Rodda.

Traders are also waiting for the US central bank’s Jackson Hole seminar later this week and a Group of Seven summit this weekend for clues on what additional steps policy makers may take to boost economic growth.

Signalling a possible escalation in the trade war, US President Donald Trump said on Tuesday he had to confront China over trade even if it caused short-term harm to the US economy because Beijing had been cheating Washington for decades.

Mr. Trump’s remarks came hours before his government announced approval of a sale of fighter jets to Taiwan, a move sure to draw Beijing’s ire and further dim prospects for a quick trade deal.

The first trader sees peso ranging from P52.20 to P52.40 versus the dollar today, while the second trader expects the local unit to trade between P52.10 and 52.50. — M.T. Amoguis with Reuters

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