Home Banking & Finance Peso weakens on rising Russia-Ukraine tensions

Peso weakens on rising Russia-Ukraine tensions

THE PESO weakened against the dollar on Monday as tensions between Russia and Ukraine grew. — BW FILE PHOTO

THE PESO depreciated versus the greenback on Monday amid growing tensions between Russia and Ukraine, which escalated further amid some pro-Russian separatist movements.

The local unit closed at P51.38 per dollar on Monday, shedding three centavos from its P51.35 finish on Friday, based on data from the Bankers Association of the Philippines.

The peso opened weaker at P51.40 versus the dollar on Monday. Its worst showing was at P51.42, while its intraday best was at P51.36 against the greenback.

Dollars exchanged increased to $713.5 million on Monday from $546.2 million on Friday.

The peso weakened amid safe- haven dollar demand as tensions between Ukraine and Russia continued to grow, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

Reuters reported that sounds of fighting were heard on the east side of Ukraine amid a clash between government forces and pro-Russian separatists. There were also satellite imagery showing Russian deployments closer to the Ukraine border.

The office of French President Emmanuel Macron reported that US President Joseph R. Biden has accepted an invitation to meet Russian President Vladimir Putin only if invasion has not happened.

Meanwhile, a trader in an e-mail said the peso depreciated after the Chinese central bank kept its policy loan prime rate unchanged.

The People’s Bank of China in a widely expected move kept the loan prime rate at 3.7% after trimming it for two consecutive months.

For Tuesday, the Mr. Ricafort expects the local unit to move within P51.30 to P51.45, while the trader gave a forecast range of P51.30 to P51.50 per dollar. —LWTN with Reuters