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D&L on track to meet P3.4B income target

By Arra B. Francia, Reporter
D&L Industries, Inc. (DNL) said it remains on track to book a P3.2-billion profit for 2018, after net income by end-September rose by 13% year-on-year.
In a statement issued Friday, the listed plastics and oleochemicals manufacturer said net income reached P2.4 billion during the January to September period. For the third quarter alone, net income climbed 13% to P874 million.
“We really had a good third quarter this year,” DNL President and Chief Executive Officer Alvin D. Lao said in a press briefing in Makati on Friday.
Revenues however slipped by four percent in the third quarter to P6.91 billion, bringing the nine-month figure to P20.17 billion, higher by one percent year-on-year. The 26% increase in revenues from aerosols products tempered the seven percent decline seen in food ingredients. Revenues from specialty plastics and oleochemicals meanwhile grew by 19% and six percent, respectively.
Mr. Lao said the sales performance was dampened by lower prices of raw materials.
“Many of the raw materials we worked with like coconut oil, palm oil, prices are down significantly. Prices of coconut oil were down over 40%, palm oil prices are down 16% compared to last year, that had a negative effect on selling prices for products that use raw materials,” Mr. Lao explained.
Despite the flat revenues, the company grew volumes of high margin specialty products (HMSP) by eight percent, driving net income margin by 11.9%.
HMSPs account for 63% of the company’s revenues, while the remaining 37% came from the commodity business.
“The growth in the high margin side of the business is a reflection of our investments in R&D which allow us to increase our market penetration and to develop more complex and customized products for our customers,” the company explained.
DNL noted that 23% of its revenues for the nine months ending September were from exports, bulk of which are food ingredients.
The company delivered a free cash flow of P4.3 billion during the period, which it will be used to pay up debt.
“We’ve paid down our debt by a lot, and that’s timely because interest rates have been going up… Our interest expense for the first nine months of the year has actually gone up from last year, so despite the lower level of debt, our interest expense level has still gone up. It’s really a reflection of higher interest rates,” Mr. Lao said.
Shares in DNL were unchanged at P10.96 each at the stock exchange on Friday.

Phoenix Petroleum 9-month core profit jumps 27%

PHOENIX Petroleum Philippines, Inc. grew its core profit by 27% in the first nine months of the year, driven by higher volumes of petroleum products sold.
The listed company led by businessman Dennis A. Uy said core net income reached P1.32 billion from January to September, as revenues doubled to P64.96 billion. The volume of petroleum products sold jumped by 51% to 2.02 billion liters, with market share steady at 7.1% based on the Department of Energy’s report in the first half of the year.
Phoenix Petroleum’s domestic business increased its volumes by 21%, boosted by an 11% uptick in fuels and 23% for LPG. Its trading operations overseas through PNX Petroleum Singapore Pte. Ltd. accounted for more than a fourth of consolidated volume sales after selling more than 500 million liters during the nine-month period.
Its recently acquired convenience store chain, Philippine FamilyMart CVS, Inc. delivered average daily sales of 21% post-acquisition. The firm attributed the growth to the launch of its Generation 2 stores, which features more food selections and larger dining areas to attract more consumers.
The company currently operates 71 FamilyMart stores, with five more stores to be opened before the end of the year. Four of the operating stores are located on board Starlite Ferries vessels, with a full store on Starlite’s MV Salve Regina plying the Batangas to Caticlan route.
“In this highly dynamic operating environment, we continue to recognize opportunities. We are broadening our products and services — fuels, LPG, convenience stores, payments, and soon, asphalt — developing credible and compelling offers that create value for our consumers, partners, and shareholders,” Phoenix Petroleum Chief Operating Officer Henry Albert R. Fadullon said in a statement.
The company plans to issue up to P10 billion worth of commercial papers this year to finance the importation of fuels and lubricants, and to repay short-term loans with BDO Unibank, Inc., Asia United Bank Corp., Robinsons Bank Corp., United Coconut Planters Bank, and Development Bank of the Philippines due in December.
Shares in Phoenix Petroleum went up by 0.73% or eight centavos to close at P10.98 each at the stock exchange on Friday. — Arra B. Francia

Imelda Marcos found guilty of graft

THE Sandiganbayan on Friday found former first lady and Ilocos Rep. Imelda R. Marcos guilty on seven counts of graft during the Marcos regime.
In a statement, Ms. Marcos, who is 89 years old, said she plans to file a motion for reconsideration.
“(Retired Court of Appeals Justice Manuel “Lolong” M. Lazaro), who has previously appeared as counsel in this case, will act as my counsel in the interim. He is presently studying the decision and has advised us that he intends to file a Motion for Reconsideration,” she said.
In its decision released on Friday, the Sandiganbayan 5th Division said Ms. Marcos is “guilty beyond reasonable doubt” for seven charges of graft over the bank transfer of $200 million in public funds to Swiss foundations that the family created.
“She is sentenced, in each of these cases, to suffer the indeterminate penalty of imprisonment from six (6) years and one (1) month as minimum to eleven (11) years as maximum, with the perpetual disqualification to hold public office,” the anti-corruption court said.
Ms. Marcos was not present during the hearing on Friday.
The Sandiganbayan also ordered the issuance of an arrest warrant against Ms. Marcos. As of press time, the arrest warrant has not been issued.
Assistant Special Prosecutor Ryan Quilala said the Sandiganbayan decision isn’t final and executory yet as the former first lady can still file an appeal.
“Di pa po final. May mga remedies si congressswoman under the law (It’s not yet final. There are still remedies for the congresswoman under the law),” he said.
Under the Sandiganbayan’s rules, Ms. Marcos has 15 days from promulgation of the ruling to file an appeal. The court has 30 days to decide on the appeal. She may also elevate the case before the Supreme Court.
The graft charges were filed against Ms. Marcos in 1991. She was not charged with plunder because the Anti-Plunder law did not exist then and the offenses were committed in the 1970s and 80s while she was still Minister of Human Settlements and member of Interim Batasang Pambansa.
Under the law, graft is a bailable crime.
Philippine National Police (PNP) Chief Oscar D. Albayalde said the PNP will not arrest the former first lady not until they are given instructions by the court to do so.
Presidential Spokesperson Salvador L. Panelo said the decision is “a good reminder to all public servants that public office is a public trust and that we are all accountable to the people we serve.”
“This latest development underscores that our country currently has a working and impartial justice system that favors no one,” Mr. Panelo said in a message to reporters on Friday. — Gillian M. Cortez

Honasan accepts DICT post

SENATOR Gregorio B. Honasan II on Friday said he is accepting President Rodrigo R. Duterte’s offer to become the next chief of the Department of Information and Communications Technology (DICT).
“For a better Philippines, a better government, for the Filipino People, and for a better future for our most precious children, I have decided to accept the offer of the President to help lead the DICT,” Mr. Honasan said in a phone message to reporters.
Mr. Honasan’s second term at the Senate ends in 2019. He is the second senator of the 17th Congress to leave the Senate to join Mr. Duterte’s Cabinet, after Senator Alan Peter Cayetano who was tapped to head the Department of Foreign Affairs.
For its part, Malacañang expressed confidence that Mr. Honasan will be able to provide a ”good direction” for the DICT.
“With the entry of a provisional new major player in the telecommunications industry, we are confident that the senator would provide good direction and sound management to the DICT, consistent with the President’s priority programs beneficial to Filipino consumers in the areas of information, communications and technology,” Presidential Spokesperson Salvador S. Panelo said in a statement.
He added that the Office of the President has yet to provide the formal appointment paper of Mr. Honasan. “For now, we congratulate Senator Honasan and wish him all the best as he undertakes genuine reforms in the DICT,” he said.
In a phone message to reporters, DICT Acting Secretary Eliseo M. Rio, Jr. said he hopes that the President will give him “a few more weeks to finalize the entry of a third telco player.”
“I would not understand why I have to be changed in midstream of a very important activity that would finally bring a significant improvement in the telecommunication industry. I see no urgency in Senator Honasan taking over, at least until I fully finish this job on the third telco, which I promised the President it would be done before Christmas,” Mr. Rio also said.
The government earlier this week declared the Mislatel Consortium, composed of China Telecommunications Corp., Dennis A. Uy’s Udenna Corp. and its subsidiary Chelsea Logistics Holdings Corp., as the provisional winner of the auction for the Philippines’ third major telco. — Arjay L. Balinbin

ASEAN leaders to push for ‘early conclusion’ of RCEP talks — DFA

THE Department of Foreign Affairs (DFA) on Friday said the leaders of the Association of Southeast Asian Nations (ASEAN) will push for the “early conclusion” of negotiations on the Regional Comprehensive Economic Partnership (RCEP) during the 33rd ASEAN Summit and Related Summits in Singapore from Nov. 13 to 15.
In a Palace press briefing on Friday, Nov. 9, DFA Assistant Secretary Junever Mahilum-West said the heads of the ASEAN member-states and other stakeholders “will look into the progress in the negotiations of this very important document” during the second summit on the RCEP next week.
The RCEP is the proposed free trade agreement between the ten ASEAN member-states and the six ASEAN free trade agreement partners (Australia, People’s Republic of China, India, Japan, Republic of Korea, and New Zealand).
“We were hoping that the RCEP would be concluded by the time of the summit, but it seems that we’ll have to wait a little bit longer. But…during the summit, the leaders would express their commitment to conclude the negotiations because this is very important for the region, especially in view of the rising trade developments, tensions…[and] unilateral actions, and we expect the leaders to call for the expeditious conclusion of the RCEP,” Ms. West said.
She added that the “leaders won’t say that [they] will finish [the negotiations] by this year,” but they “will call on all parties to make sure that we have an early conclusion of the agreement.”
The DFA official also announced that President Rodrigo R. Duterte “will be participating in this summit at the invitation of Singapore Prime Minister Lee Hsien Loong.”
“This is the second and last summit of ASEAN for the year. Apart from their own meeting, the ASEAN leaders will have summits with leaders from dialogue partners in the format of the Plus One Summit. They are going to meet individually with Australia, China, India, Japan, Republic of Korea, Russia and the United States. At the ASEAN-Plus Three Summit, that means ASEAN 10 with the leaders of China, Japan and the Republic of Korean; and in the East Asia Summit, which includes Australia, China, India, Japan, New Zealand, Republic of Korea, Russia and the United States,” she explained.
She added that regional and international issues on peace and security, particularly in the Korean Peninsula and the South China Sea, may be tackled.
According to Ms. West, during the event, “Singapore will symbolically hand over the Chairmanship of ASEAN to Thailand, and Thailand will assume as Chair at the beginning of 2019.” — Arjay L. Balinbin

NEDA ICC-CabCom approves increase in North-South Commuter Railway project cost

Philippine National Railways (PNR)
BW FILE PHOTO

By Melissa Luz T. Lopez, Senior Reporter
THE NATIONAL Economic and Development Authority (NEDA) raised the project cost for the long-haul commuter line of the Philippine National Railways (PNR) by nearly double to buy more trains and build elevated tracks.
In a statement, the NEDA said that the Investment Coordination Committee-Cabinet Committee approved a P777.551-billion total project cost for the North-South Commuter Railway (NSCR), a 76.4% mark-up from P440.881 billion previously.
The railway system will combine the NSCR Phase 1 linking Malolos, Bulacan to Tutuban in Manila, the PNR South Commuter Railway from Solis to Calamba, Laguna, and the Malolos-Clark Railway Project. The project entails building a 147-kilometer stretch of an elevated, double-track railway with 36 stations.
These form part of the priority infrastructure projects under the “Build, Build, Build” program of the Duterte administration.
The approval was given during the committee meeting on Tuesday, Nov. 6.
“The increase in project cost is attributed to three factors as determined by the detailed engineering designs,” the NEDA said on Friday.
Among the major changes behind the bigger project price include the construction of elevated viaducts for the trains, veering away from ground-level structures to “improve operational efficiencies” and safety. Existing PNR rail systems are currently built right on the ground.
Other changes include the adoption of standard gauge tracks versus the previous narrow-gauge plan. The higher price tag will likewise cover the purchase of more trains as well as the use of double tracks for the Malolos-Clark line, the NEDA said.
The additional costs will also provide for the resettlement of 12,901 families who will be displaced by the construction of the new train lines.
Still, the new train line will be financed through official development assistance from the Japan International Cooperation Agency (JICA) and the Asian Development Bank.
The railway project is expected to be partly operational by 2022 and will service 340,000 passengers daily. The trains will be fully operational by 2023 and can carry up to 550,000 people daily.
The NSCR system will also be linked to the existing Light Rail Transit lines 1 and 2, the Metro Rail Transit 3, and the planned Metro Manila Subway also funded by JICA.
The government will provide a P5 billion subsidy each year to cover the capital, operating and renewal costs of the project, the NEDA said.
The higher project cost and new railway design will still have to be approved by the NEDA Board, which is chaired by President Rodrigo R. Duterte.

IPPCA opposes increase in diesel biofuel component

THE Independent Philippine Petroleum Companies Association (IPPCA) opposed the plan of the Philippine Coconut Authority (PCA) to increase the biofuel component in diesel to B5 from B2.
“With Euro 4, there is no compelling reason to add or increase the biodiesel blend, given that the current diesel standard is already very clean,” IPPCA said in a statement sent to BusinessWorld.
“At the same time, increasing the blend will have an impact on the price of diesel to go up. Thus, why should motorist made to subsidize another industry?,” according to IPPCA.
Department of Agriculture (DA) Secretary Emmanuel F. Piñol earlier said the PCA board of governors has passed a resolution addressed to President Rodrigo R. Duterte to direct the National Biofuels Board (NBB) to raise the biofuel requirement from B2 to B5 to help the copra industry.
Mr. Piñol said fuel prices will rise by about P0.30 once the shift to B5 from B2 is implemented, while noting this would mean cleaner air and more mileage for vehicles.
Sherwin T. Gatchalian, chair of the Senate committees on energy and economic affairs, also expressed concerns over the proposed measure, saying this will put consumers at a disadvantage given that fuel prices are already rising even without such a shift.
“Based on our in-house computations, diesel pump prices will go up by P2.48/liter,” Mr. Gatchalian said when sought for comment regarding the PCA’s resolution.
“At this present situation of elevated petroleum prices due to external factors, it is not advisable to increase the biodesiel blend to B5 at this time. Magiging triple whammy yan para sa consumers natin: 1. Tax reform 2. Elevated global prices 3. Increase to B5 pa,” Mr. Gatchalian added. — R.J.N. Ignacio

IFAD to invest $63.5 million in agricultural enterprises

rice grains
PHILSTAR/KRIZ JOHN ROSALES

THE International Fund for Agricultural Development (IFAD) will invest $63.5 million to support agriculture-based micro and small enterprises in 20 provinces across Eastern Visayas and Mindanao.
The IFAD’s Rural Agro-enterprise Partnerships for Inclusive Development and Growth Project (RAPID Growth) will be implemented by the Department of Trade and Industry (DTI) and will support the growth of the enterprises in value chains with comparative advantage, market demand, growth potential, linkages to small farmers, and job-generating activities.
“The RAPID GROWTH project is in line with the Philippine Development Plan (2016-2022) and IFAD’s country strategy for 2017-2022 focusing on testing innovative models for improving the competitiveness, inclusion and resilience of agri-food value chains of relevance for poor and vulnerable households,” IFAD Philippines Country Director Alessandro Marini said in a statement.
IFAD is an international financial institution and a specialized agency under the United Nations focused on investing in rural communities to help them achieve food security, good nutrition and higher income.
IFAD country program officer Jerry E. Pacturan said the RAPID GROWTH program support’s the agency’s commitment to support smallholder farmers and small and medium enterprises (SMEs) in the Philippines, particularly those focused on cacao, coffee, coconut, and processed fruits and nuts.
“Domestic and regional demand for rural goods and agricultural commodities is growing rapidly. Enterprises that operate efficiently, sourcing sufficient quality raw materials, applying modern technology and complying with recognized product standards have substantial potential to create income opportunities for smallholder farmers and other disadvantaged groups in rural communities. This is why IFAD is interested in supporting the growth of these enterprises,” Mr. Pacturan said.
The IFAD also said it is considering the possibility of allocating part of its ongoing investment in the country to help in the rehabilitation of Marawi City in response to an official request by the Department of Finance (DoF).
“The core of the investment would be directed to the rehabilitation of irrigation infrastructure and related capacity building for affected communities, already identified by the Philippine government as part of the Bangon Marawi Comprehensive Rehabilitation and Recovery Program. The National Irrigation Administration (NIA) will be the main implementing partner as proposed by government. We are currently working with NIA and DoF to define the details of this support,” Mr. Marini said. — Reicelene Joy N. Ignacio

Metrobank raises P10 billion from fixed-rate bonds

METROPOLITAN Bank & Trust Co. (Metrobank) has raised P10 billion in fresh funds via fixed-rate bonds — the first ever bond issuance by a local lender since the regulator liberalized rules on banks’ fundraising activities.
In a disclosure on Friday, Metrobank said the bond issuance, which is part of its P100-billion bond and commercial paper program announced last month, carry an interest rate of 7.15% and a two-year tenor. The lender listed the papers on the Philippine Dealing & Exchange Corp. last Friday.
The bank’s issuance marks the first ever by a local lender under Bangko Sentral ng Pilipinas’ Circulars 975 and 1010 which allow banks to tap the capital market as a funding source without having to secure approval from the regulator. It is also the first bank bond priced under the new benchmark, the PHP Bloomberg Valuation Service Reference Rates, which replaced the Philippine Dealing System Treasury Reference Rates.
Metrobank said the offering was almost 10 times oversubscribed on the back of robust demand during the book building process. The lender upsized the issue to P10 billion from its initial target issue size of P2 billion after orders reached as much as P19.635 billion.
Standard Chartered Bank acted as the transaction’s sole arranger, selling agent and market maker. Metrobank and First Metro Investment Corp. were also selling agents, while UnionBank of the Philippines was another market maker.
“We are proud to once again be a trailblazer in the local bond market. Our hope is that this issuance paves the way for a robust market for bank-issued bonds in the near future. We are grateful to the BSP and the SEC (Securities and Exchange Commission) for allowing this opportunity to diversify our sources of liquidity to fund our growth prospects…,” Metrobank President Fabian S. Dee was quoted as saying in the statement.
“This is a major development in deepening the local capital markets space as we expect other banks to follow suit. This maiden issuance allows Metrobank to establish its own credit curve and will serve as a benchmark not only for its future issuances but also for other bank issuers,” Standard Chartered Bank Philippines CEO Lynette V. Ortiz said.
Last month, Metrobank likewise raised some P8.68 billion from the first tranche of its P25-billion long-term negotiable certificates of deposit program. The notes will mature in 5.5 years to be paid quarterly and carry a 5.375% rate.
Metrobank posted a P5.3-billion income in the second quarter, up 31% from the P3.9 billion tallied the previous year on the back of its robust core business.
Shares in Metrobank went down 50 centavos or 0.76% to close at P65.05 each on Friday.

RCBC, EastWest Bank book lower profits in first nine months


RIZAL Commercial Banking Corp. (RCBC) and East West Banking Corp. (EastWest Bank) saw their net incomes decline in the first nine months due to lower trading gains and revenues, respectively.
In a disclosure on Friday, RCBC said it posted a consolidated net income of P3.2 billion in the nine months ended September, down from its P3.4-billion profit in the same period last year, amid a decline in trading gains.
The bank said excluding trading gains, its core income went up 42% year-on-year as its main businesses continued to grow.
RCBC’s net interest income went up 12% to P14.7 billion as of September driven by a 12% growth in its loans to P379 billion. Average loan volume of its corporate segment grew 9%, while the SME segment expanded 32% and consumer by 33%, with credit card receivables growing 33%. RCBC’s microfinance arm Rizal MicroBank also grew its average loan portfolio by 20% year-on-year.
Still, despite the growth in its lending business, asset quality remained healthy, with its consolidated nonperforming loan (NPL) ratio at 1.22% from 1.41% last year. NPL coverage also improved to 96.94% at the consolidated level from last year’s 77.39%, while the level was at 141.84% at the parent bank level.
Meanwhile, RCBC’s gross income stood at P19.4 billion in the first nine months, with total operating income at P4.7 billion. Fee-based income grew 15%.
On the other hand, the bank’s operating expenses amounted to P14.4 billion in the period amid its continued branch expansion and higher documentary stamp taxes.
RCBC’s network grew to 509 branches as of September from 503 a year prior, while its automated teller machines were at 1,593 versus 1,539 the previous year.
The bank’s consolidated resources grew 17% to P614.4 billion. Deposits increased 10% to P410.1 billion, with its current accounts and savings accounts at P231.8 billion as of September.
Its capital position stood at P83.6 billion, with its capital adequacy ratio (CAR) at 17.28% and common equity Tier 1 (CET1) ratio at 14.45%.
Shares in RCBC went up 20 centavos or 0.72% to P28 each on Friday.
EASTWEST BANK
Meanwhile, the Gotianun-led EastWest Bank said in a separate disclosure on Friday that it booked a net income of P3.2 billion in the first nine months, 13% lower year-on-year mainly due to an increase in capital stock as well as the lower income contribution from its wholly-owned subsidiary EastWest Rural Bank (EWRB).
EWRB only resumed its lending program to public school teachers in late June after being suspended since November 2018.
EastWest Bank said its core recurring operating revenues increased by 8% year-on-year.
Its nine-month net income translated to a return on equity of 10.7% and return on assets of 1.4%.
The lender’s net interest income grew 6% to P14.5 billion as of September on the back of the expansion of its consumer lending businesses. Excluding teachers’ loans which declined, EastWest Bank’s consumer portfolio of credit cards, auto, home and personal loans went up 14%. Consumer loans accounted for 72% of its total loans. Meanwhile, its commercial lending business grew 6%.
“The increase in consumer loans allowed the bank to minimize the impact of lower margins as deposit interest rates rose faster and higher than loan rates,” EastWest Bank said.
Fees and commissions declined 16% to P3.4 billion due to the lower contribution from its rural bank subsidiary. On the other hand, trading income went up 33% to P444.8 million, driven by foreign exchange trading gains.
Meanwhile, the bank’s operating expenses went up 13% to P11.1 billion at end-September.
EastWest Bank’s total assets stood at P337.2 billion as of September, up 7% from the previous year.
Its CAR stood at 13.1%, while its CET1 ratio was at 10.6%, still above the regulatory minimums.
EastWest Bank shares finished at P10.56 apiece on Friday, down 10 centavos or 0.94%.

BSP closes Quezon City bank

THE BANGKO SENTRAL ng Pilipinas (BSP) has shut down a bank based in Quezon City, bringing the number of closed lenders to 12 this year.
The BSP’s Monetary Board ordered the closure of the San Francisco Del Monte Rural Bank on Thursday. The Philippine Deposit Insurance Corp. (PDIC) took over the bank a day later and liquidate its assets.
San Francisco Del Monte Rural Bank runs one branch in Barangay Damayan in the city.
The central bank has the authority to shut down banks which are found not viable to remain in business. The PDIC’s takeover paves the way for the state-run insurer to acquire the bank’s assets and pay liabilities to depositors.
Bank deposits are insured up to P500,000 per depositor, according to the PDIC charter. Any lender which have been placed under liquidation cannot be reopened or revive its banking operations.
Funds used to settle valid deposit insurance claims are drawn from the Deposit Insurance Fund managed by the PDIC, as well as from remaining cash and assets held by the fallen lender.
With the PDIC takeover, bank directors, officers and shareholders cannot do transactions or meddle with records on the lender’s behalf.
The shutdown of the Quezon City-based bank brings the total of shuttered lenders to 12 this year, already well above the seven which the BSP ordered closed in 2017.
Other lenders which have been shuttered by the BSP this year include the Rural Bank of Maigo, Inc. in Lanao del Norte; the Rural Bank of Luna, Inc. in Apayao; Rural Bank of Pagbilao, Inc. in Quezon; the Rural Bank of Sta. Elena, Inc. in Camarines Norte.
The Tiaong Rural Bank, Inc., Empire Rural Bank, and Women’s Rural Bank, Inc. in Batangas; Bangko Buena Consolidated, Inc. of Iloilo; the Rural Bank of Initao, Inc. in Misamis Oriental; and the Rural Bank of Loreto, Inc. in Dinagat Islands have also been ordered to stop operations earlier this year.
BSP Governor Nestor A. Espenilla, Jr. previously said that they are actively weeding out “weak” banks in the interest of consumer protection and financial stability. — Melissa Luz T. Lopez

Peso snaps winning streak on Fed hike bets

By Melissa Luz T. Lopez, Senior Reporter
THE PESO ended its five-day uptrend on Friday to log its weakest showing in three days, just as bets of another rate hike in the United States next month became more certain.
The local unit closed the week at P52.96 versus the dollar, 39 centavos weaker than Thursday’s P52.57 rate which was a five-month low, to wipe out the sharp drop posted that day.
This is the currency’s weakest performance since the P53.025-per-dollar rate on Tuesday.
The peso lost its strength during the entire session as it opened at P52.87 against the greenback. Its best showing was at P52.83, while it hit an intraday low of P52.97 before settling at the closing rate.
Sought for comment, two traders attributed the peso’s slump to a stronger dollar, which gained strength from the outcome of the policy meeting of the US Federal Reserve.
“The peso briefly weakened which can be attributed to bargain-hunting for the greenback following the upbeat US initial jobless claims data and muted Fed remarks increased bets of a December Fed rate hike,” one trader said.
The Fed affirmed that the US economy remains on solid footing, reaffirming its hawkish monetary policy stance and setting the stage for another rate hike.
The peso also tracked the downward move of other currencies in the region against the greenback, according to Reuters.
A second trader affirmed that the peso depreciated due to broad dollar strength overnight, as market players were assured that the Fed will proceed with another hike worth 25 basis points during their December meeting.
The trader added that the peso traded within range for the rest of the session, without large inflows seen the previous days to help boost the currency.
Dollars traded on Friday amounted to $897.5 million, down from the $1.353 billion which exchanged hands the previous session. A trader attributed the higher-than-usual volumes the past few days to equity inflows for a follow-on offering by a listed conglomerate.

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