THE PESO inched down versus the dollar on Wednesday as global oil prices continued to pick up.

The local unit ended trading at P47.731 per dollar, slipping by 1.1 centavos from its P47.72 close on Tuesday, data from the Bankers Association of the Philippines showed.

The peso opened Wednesday’s session at P47.735 versus the dollar. It moved within a narrow range as its weakest showing was at P47.77, while its intraday best was at P47.71 against the greenback.

Dollars exchanged went up to $675 million from $650.7 million on Tuesday.

The peso retreated due to risk-off sentiment because of higher oil prices, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said.

Reuters reported that oil marked a second straight session of uptick on Wednesday backed by signs of upbeat fuel demand in Western economies.

Brent crude futures increased 32 cents or 0.4% to $72.54 per barrel by 0640 GMT. Meanwhile, the US West Texas Intermediate crude futures rose by 31 cents or 0.4% to $70.36 a barrel.

The US Energy Information Administration on Tuesday upgraded its US fuel consumption growth forecast for this year to 1.49 million barrels per day (bpd) from 1.39 million bpd previously.

The peso dropped as the market was waiting for the release of latest US inflation data, a trader said in an e-mail.

The US Labor department will report the May consumer price index data this Thursday. In April, US inflation stood at 0.8%, which was its quickest pace since June 2009.

For Thursday, Mr. Ricafort gave a forecast range of P47.68 to P47.78 per dollar, while the trader expects the local unit to move within P47.65 to P47.85. — LWTN with Reuters