The peso inched higher against the dollar on Tuesday, May 8, ahead of the local monetary policy meeting as well as inflation data in the US.
The local currency ended at P51.85 on Tuesday, two centavos stronger than the P51.87-per-greenback finish on Monday.
The peso traded within the range, opening the session slightly stronger at P51.86. It dipped to as low as P51.945, while its best showing stood at P51.83.
Dollars traded soared to $727 million from the $585 million logged in the previous session.
Traders interviewed following the trading’s close said the pair “traded fairly quiet” as it traded within the range.
“Although there was volume, there’s no direction as to where the next direction for the dollar-peso will be,” a trader said in a phone interview.
The trader added that: “We’re still waiting for the BSP (Bangko Sentral ng Pilipinas) meeting on Thursday.”
Investors are waiting for the monetary policy meeting of the BSP on whether it would keep its monetary stance steady.
In a BusinessWorld poll, nine out of 11 economists said that the monetary authority will likely hike its benchmark rates at Thursday’s meeting, as the inflation hit multi-year highs and showed slim signs of slowing down.
Inflation has been steadily accelerating this year, as it sped up to a five-year high of 4.5% last month under the 2012 base year. It was faster than the 4.3% inflation logged the previous month.
The BSP has also said that the inflation is becoming broader than initially expected.
“What we react to is whether it’s spreading and it is affecting expectations. And our reading, based on the latest data, it seems to have spread somewhat,” BSP Governor Nestor A. Espenilla, Jr. told reporters last week.
Aside from the monetary policy meeting, another trader said investors were also waiting for the US consumer price data in the US. — Karl Angelo N. Vidal