THE peso held steady against the dollar even as the greenback surged against the yen as currency traders brushed off the latest missile fired by North Korea in a volatile day of trading on Friday.

The peso on Friday closed at P51.165, unchanged from the previous trading session. It was a choppy session, though, as the local currency opened weak at

P51.25 against the greenback and extended losses to hit a trough of P51.295 in intraday trade before recovering to close unchanged.

“The peso initially weakened today amid upbeat US inflation data, but trimmed its losses towards the end of the day due to profit taking,” Guian Angelo S. Dumalagan, market economist at the Land Bank of the Philippines, said in an email.

US consumer prices accelerated in August amid a jump in the cost of gasoline and rental accommodation, signs of firming inflation that could allow further monetary policy tightening from the Federal Reserve this year.

“Strong US inflation report keeps open the possibility of another US interest rate hike this year,” Mr. Dumalagan said. If realized, this would be the third US rate hike for the year.

Dollars traded were valued at $638.6 million, up from the $633.55 million recorded in the previous trading session.

Another trader said that dollar inflows came in 30 minutes before the foreign exchange market closed, that tempered the peso’s upward momentum.

“Agent banks sold again at the close. I I feel like that’s part of the reason why it closed higher yesterday,” he said in a phone interview.

For another trader, North Korea’s firing a missile that flew over Japan into the Pacific Ocean made traders adopt a risk-on sentiment.

The dollar slipped to as low as 109.55 yen in Asian trading, but rebounded in European trading.

“North Korea launched a missile again. However, I think there are still corporate inflows this afternoon. Also the market was profit taking ahead of the weekend,” she said. – Reuters with Elijah Joseph C. Tubayan

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