THE PESO sank to a new 19-month trough against the greenback on Tuesday ahead of the release of May inflation data.

The local unit closed at P58.71 per dollar on Tuesday, weakening by three centavos from its P58.68 finish on Monday, Bankers Association of the Philippines data showed.

This was the peso’s worst finish in 19 months or since its P58.80-a-dollar close on Nov. 3, 2022.

The local unit is now down by P3.34 from its end-2023 close of P55.37 versus the greenback.

The peso opened Tuesday’s session stronger at P58.62 against the dollar. Its intraday best was at P58.58, while it dropped to as low as P58.75 versus the greenback.

Dollars exchanged inched up to $1.317 billion on Tuesday from $1.315 billion on Monday.

“The peso weakened anew from domestic caution ahead of the Philippine inflation report [on Wednesday],” a trader said in an e-mail.

The market widely expects headline inflation to have picked up further last month, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

Headline inflation may have quickened for a fourth straight month in May due to higher electricity costs, analysts said.

A BusinessWorld poll of 16 analysts conducted last week yielded a median estimate of 4% for the May consumer price index (CPI), within the central bank’s 3.7-4.5% forecast for the month.

If realized, May inflation would be faster than 3.8% in April but slower than the 6.1% print in the same month a year earlier.

This would mark the sixth straight month that headline inflation was within the central bank’s 2-4% annual target.

The Philippine Statistics Authority will release May CPI data on Wednesday (June 5).

For Wednesday, the trader said the peso will likely trade against the greenback depending on the inflation report.

The trader and Mr. Ricafort see the peso moving between P58.60 to P58.80 per dollar on Wednesday. — A.M.C. Sy

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