THE PESO strengthened against the dollar on Tuesday as the country logged a balance of payments (BoP) surplus last month and on news that patients in the clinical trials of drug company AstraZeneca Plc showed a positive response to its coronavirus vaccines.

The local unit closed at P48.375 versus the dollar on Tuesday, rising by two centavos from its P48.395 finish on Monday, data from the Bankers Association of the Philippines showed.

The peso opened Tuesday’s session at P48.40 against the greenback. It reached a peak of P48.37 while its weakest showing was at P48.48 per dollar.

Dollars traded rose to $838.87 million on Tuesday from $671.25 million on Monday.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the peso rose after the Bangko Sentral ng Pilipinas (BSP) reported a BoP surplus in September.

“The peso was stronger after stronger BoP surplus data as the highest in four months in 2020 and the third highest since 2019,” Mr. Ricafort said in a text message.

The country’s BoP position remained at a surplus for the eighth consecutive month in September, supported by the central bank’s foreign exchange operation and profits from investments abroad.

The BSP on Monday said the balance of payments surplus stood at $2.104 billion in September, ballooning from the $38-million surfeit in the same month in 2019. This was also 220% higher than the $657-million surplus posted in August and the highest since May’s $2.431 billion.

Meanwhile, a trader said the peso appreciated after results of the clinical trials of coronavirus vaccines from drug company AstraZeneca Plc and University of Oxford yielded positive results.

One of the world’s leading COVID-19 experimental vaccines produces an immune response in both old and young adults, raising hopes of a path out of the gloom and economic destruction wrought by the novel coronavirus, Reuters reported.

The vaccine, developed by the University of Oxford, also triggers lower adverse responses among the elderly, British drugmaker AstraZeneca, which is helping manufacture the vaccine, said on Monday.

The Oxford/AstraZeneca vaccine is expected to be one of the first from big pharma to secure regulatory approval, along with Pfizer and BioNTech’s candidate.

For today, Mr. Ricafort expects the peso to range from P48.32 to P48.42 against the dollar, while the trader sees it moving from P48.30 to P48.50. — KKTJ with Reuters