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Bangko Sentral requires lenders to disclose strategies for rate risks

THE CENTRAL BANK’S policy-setting body Monetary Board laid out additional disclosures required under the Risk-Based Capital Adequacy Framework for the Philippine Banking System on interest rate risk in the banking book (IRRBB) for both lenders and quasi-banks (QBs).

Besides the general disclosure requirement, the Bangko Sentral ng Pilipinas (BSP) has also ordered banks to disclose in their annual report their management and mitigation strategies.

In a memorandum signed by BSP Governor Benjamin E. Diokno, strategies cited include the “monitoring of risk measures in relation to established limits, hedging practices, conduct of stress testing, outcomes analysis, the role of independent audit, the role and practices of the asset and liability committee (ALCO), the bank’s practices to ensure appropriate model validation, and timely updates in response to changing market conditions.”

The central bank said in a statement in August that IRRBB refers to the current or prospective risk to capital and earnings that come from big movements in interest rates that affect banking book positions.

Meanwhile, banking book positions pertain to assets that yield interest income which would include loans and investments and liabilities paying out interest such as deposits.

“The guidelines aim to provide clear expectations on how a bank/QB should manage IRRBB and align the BSP’s supervisory framework on interest rate risk with international standards,” the central bank said.

The BSP said it expects stand-alone thrift, rural and cooperative banks to look into the impact of a 1-3% movement in interest rates in relation to their net interest income for the succeeding 12-month period. For their part, big banks and QBs are to come up with a wider scope of interest rate shock and stress scenarios where they will test their IRRB exposures.

Aside from a description of their overall IRRBB management and mitigation strategies, banks are also required to disclose the period of the calculation of their IRRBB measures as well as to describe the interest rate shock and stress scenarios they utilized to estimate the difference in the earnings.

The BSP also said banks should present a “high level description of key modelling and parametric assumptions used in IRRBB measurement” as part of their disclosure. — L.W.T. Noble

Davao del Sur lab for mango exports proposed

DAVAO CITY — A laboratory for determining the chemical residue level on mangoes is being planned for construction in Davao del Sur as part of preparations to export the fruit to New Zealand initially, and later to other foreign markets.

Delia M. Ayano, Department of Trade and Industry director for Davao del Sur, said stakeholders have started drafting the proposal.

“There are groups planning to sell their mangoes abroad, so the proposed laboratory will help them meet the standards that the international markets will set up,” Ms. Ayano told the media last week.

She added that Vicente T. Lao, honorary consul of New Zealand in Mindanao and chair of the Mindanao Business Council, is the project’s point person.

Mr. Lao said the facility is still in the planning stage and that New Zealand is helping draft the proposal.

“It is still in the planning stage, but I hope this will be realized,” he told BusinessWorld in a text message.

Davao del Sur accounted for over 77% of the 53,355 metric tons of mangoes that the Davao Region produced in 2018, based on Philippine Statistics Authority data.

The establishment of a regional mango council was initiated in November during a forum organized by the Mindanao Development Authority (MinDA) to discuss best practices as well as ways to improve crop production.

The council aims to link up with other mango groups in Mindanao.

The government, through MinDA, earlier signed a three-year co-investment project with the New Zealand Embassy and NZ G2G Partnerships Ltd. for mango exports.

One of the projects under the program is a feasibility study for setting up quality assurance systems for fresh mango to ensure compliance with sanitary and phytosanitary standards. — Carmelito Q. Francisco

A more advanced and responsive Ultraboost

ONE OF the more popular shoe lines of adidas — the Ultraboost — gets more elevated with the Ultraboost 20.

Done in collaboration with the International Space Station (ISS) US National Laboratory and released locally early this month, the latest iteration of the Ultraboost boasts of more advanced features for higher performance.

Each element in the Ultraboost 20 is designed for a specific performance-driven function.

Its upper is made up of upgraded Primeknit which employs Tailored Fiber Placement (TFP), allowing for better fit and support when one is on the move.

The Optimized Boost and Torsion Spring found in the UB 19 is still present while the Stretchweb technology used in the rubber outsole gives more response and cushion for every stride.

“The Ultraboost 20 is even more advanced and responsive than the Ultraboost 19 or any of the previous Ultraboosts,” assured Jen Dacasin, adidas Brand Communications and Sports Manager, in an interview at the new shoe’s launch, by way of the “Ultraboost 20 Space Race Manila” event, on Dec. 14 at the Mind Museum at Bonifacio Global City.

“As adidas’ most advanced and responsive running shoe, we see the Ultraboost 20 as a shoe that can give runners an out-of-this-world level of performance. With the new Ultraboost 20… runners can continue to strive to reach their peak physical fitness,” she added.

To test the performance-driven functions of the Ultraboost 20, adidas, together with adidas Runners Manila, staged the Ultraboost 20 Space Race Manila.

The first portion of the event gave runners the opportunity to better understand their running strengths and opportunities through the Performance Quotient assessment sessions.

Speakers were Anthony Pangilinan, Jo Sebastian, Cam Lagmay and Aaron Azreg, and Steph Yee, who spoke to the runners about Mindset, Nutrition, Movement, and Recovery, respectively.

To cap off the event, runners went through the District Chase Challenge, a five-kilometer group race using the District Race app, which allowed runners to explore the city using augmented technology.

Ms. Dacasin said that after this latest collaboration with the ISS US National Lab, consumers can expect further innovation in adidas products, which they will continue to share to the local market.

“Through the partnership with the ISS US National Lab, adidas will be exploring a new dimension of research and testing: microgravity conditions, which will help find potential enhancements for products’ motion and comfort. Consumers can expect adidas to continue improving its products to give everyone — from elite athletes to casual runners — an improved sports performance,” the adidas official said.

The Ultraboost 20’s first set of colorways is inspired by the partnership between adidas and the ISS US National Lab. All Ultraboost 20s will also include an exclusive logo created for the adidas and ISS National Lab partnership.

The Ultraboost 20 retails for P9,500 and is available in-store and online at adidas.com.ph/ultraboost. — Michael Angelo S. Murillo

Voyager to hit 20M user base ‘very soon’

VOYAGER Innovations, Inc. said it is close to hitting 20 million users on its platforms as it targets to have P1 trillion annual transactions in PayMaya by 2023.

The digital arm of PLDT, Inc. — which handles mobile wallet PayMaya and mobile remittance arm Smart Padala — said it is continuing to gain traction on its platforms as it expands its catalogue of use cases.

Asked when the company could hit 20 million users on its platforms, Voyager President Shailesh Baidwan told reporters last week: “We should reach that very soon. Because we have customers who use our wallet (PayMaya). We also have remittance through Smart Padala… So we have all these users who are doing all the same behavior. We have a very large base.”

The company does not disclose actual user figures, but it previously claimed PayMaya has the largest active user base in the Philippines.

Mr. Baidwan said Voyager’s thrust is to be “used for what our customers need to do,” hence the development of products that provide services such as bills payment, sending money and online shopping, among others. It also works with merchants to develop payment processing.

Aside from PayMaya and Smart Padala, Voyager also owns financial technology firm FINTQnologies Corp., whose products include digital banking, digital aid & finance and digital lending platforms.

Voyager Founder and Chief Executive Officer Orlando B. Vea said while the company is far from booking profits, it is happy to continue investing as some parts of the business are already recording positive margins.

“[We’re] positioning ourselves for massive growth. Without investments, we cannot grow the way we want to,” he said.

PLDT has invested some P9-10 billion in Voyager from 2013 to 2018 before it welcomed foreign investors last year which infused $215 million (about P10.91 billion) into the firm. These foreign companies include China’s Tencent Holdings Ltd., the developer of WeChat and WeChat Pay.

Other investors are US-based investment firm Kohlberg Kravis Roberts & Co. and World Bank’s International Finance Corp. (IFC) and IFC Emerging Asia Fund. The entry of the investors reduced PLDT’s stake in Voyager to below 50%.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls. — Denise A. Valdez

Driving ohm for Christmas: Nissan LEAF becomes sparkling Nissan Christmas TREE, powered by regenerative energy

PARIS, FRANCE — Nissan will be dashing through the snow this Christmas with a bright festive Nissan LEAF powered by its own regenerated energy.

To bring Christmas cheer while celebrating the power of regenerative energy creation, the special one-off vehicle sees the Nissan LEAF transformed into a Nissan (Christmas) TREE. Decked out in a spectacular light display, the Nissan TREE showcases the way the electric car regenerates power when braking or decelerating.

Two driving functions provide energy regeneration in the Nissan LEAF. The Nissan LEAF e-Pedal allows the driver to start, accelerate, decelerate and stop using only the accelerator pedal. The e-Pedal also helps the car to harvest energy via regenerative braking. This works by recycling the energy from the movement of the car during braking or deceleration, which then goes straight back to the batteries, where it is used to recharge them. Meanwhile, B mode is a driving function that regenerates energy under braking, with drivers using the traditional brake pedal as normal.

LET IT GLOW, LET IT GLOW, LET IT GLOW
Fitted with thousands of LEDs, shimmery baubles and a reindeer, the car is brighter than Rudolph’s nose. The sparkling display reminds sustainably minded drivers about the energy generation made possible through owning an electric vehicle. In fact, the average Nissan LEAF driver regenerates 744kWh of clean energy if they drive 18,000km. This energy saving is equivalent to 20% of the overall domestic electricity consumption of an average European household.

Nissan LEAF drivers would generate enough energy to power up:

• 266 Christmas trees with 700 incandescent lights for a full hour of joy

• 297 ovens for one hour to cook your Christmas dinner

• 744 televisions for five hours to watch your favorite Christmas movies

• 10,783 houses with 1,000 LED lights for five hours

“Santa shouldn’t be the only one with a festive mode of transport. We wanted to make the Nissan LEAF more fun at this time of year whilst driving home a very important message,” said Helen Perry, head of Electric Vehicles for Nissan Europe.

“We hope this custom-made vehicle inspires people about the endless benefits of regenerative energy. After nearly ten years since LEAF was first introduced in Europe, Nissan continues to be fully focused on providing consumers a more sustainable lifestyle through electric mobility,” Ms. Perry added.

Yields on local gov’t debt track US Treasuries’ rates

YIELDS on local government securities (GS) traded at the secondary market ended mixed last week as they tracked US Treasuries following the news of an impeachment case against US President Donald J. Trump.

Debt yields, which move opposite to prices, went down by an average of 2.6 basis points (bps) week on week, based on the PHP Bloomberg Valuation (BVAL) Service Reference Rates as of Dec. 20 published on the Philippine Dealing System’s website.

At the short end of the yield curve, the 91- and 364-day Treasury bills (T-bills) declined by 4.5 bps and 0.8 bp to fetch 3.209% and 3.463%, respectively. On the other hand, the rate on the 182-day T-bill went up by 2.7 bps, yielding 3.374%.

At the belly of the curve, the rates on the two- three-, four-, five- and seven-year Treasury bonds (T-bonds) dropped by 0.7 bp (3.718%), 4.8 bps (3.809%), 8 bps (3.918%), 10.3 bps (4.04%), and 10.3 bps (4.278%), respectively.

Meanwhile, the yield on the 10-year T-bond went down by 3.2 bps to fetch 4.504%. On the other hand, the 20- and 25-year debt papers saw their yields go up by 4.3 bps (5.208%) and 7.2 bps (5.230%), respectively.

“Market players seemed to take their cues from the US Treasury movements [last week]…,” UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion said in an e-mail, adding there was “mixed interest” seen all over last week due to the recent impeachment bid against Mr. Trump.

The US House of Representatives approved two articles of impeachment against Mr. Trump for abuse of power and obstruction of Congress, Reuters reported last Wednesday. A trial next month to decide whether he will be convicted and removed from office is expected at the US Senate.

Meanwhile, ATRAM Trust Corp. Head of Fixed Income Jose Miguel B. Liboro said GS yields have “adjusted slightly higher” from its levels on Dec. 13 that saw movements influenced that time by Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno’s statement of a possible 50-bp rate cut next year.

“Despite this retracement, yields remained lower than where we had closed the previous week,” Mr. Liboro said in a separate e-mail.

BSP’s Mr. Diokno told reporters earlier this month that the central bank is looking to cut rates by at least 50 bps in 2020 as it continues to reverse the 175 bps worth of hikes in 2018 implemented in the face of surging inflation that averaged a near-decade-high of 5.2% that year.

Benchmark interest were cut by a total of 75 bps this year.

The BSP also said last Wednesday that economic managers decided to keep its 2-4% annual inflation target until 2022 as forecasts indicate “within-target inflation over the policy horizon.”

Moving forward, UnionBank’s Mr. Asuncion expects yields to move sideways because of a “limited trading week due to the holidays.”

He noted that the market is still expected to take much of its signal from developments abroad.

“Next week’s trading may pick up from the continuing drama of the same US political process mentioned [earlier],” Mr. Asuncion said.

For ATRAM Trust’s Mr. Liboro: “Given just a few workdays left in 2019, yields are likely to consolidate around current levels as we expect trading interest to dry up with investors closing their books for yearend.” — J.E. Hernandez

Meat imports rise nearly 2% in first 10 months

MEAT and meat products imports rose about 2% in the first 10 months of 2019, the Bureau of Animal Industry (BAI) said.

Citing data from the BAI National Veterinary Quarantine Services Division (NVQSD) meat and meat products imports rose 1.9% year-on-year to 696.538 million kilos. Peak imports were recorded in October at 85.329 million kilos.

The 10 months data did not include duck and turkey meat.

Pork imports accounted for 287.774 million kilos, down 8% year-on-year. This was followed by chicken at 266.075 million kilos, up 15%, and beef at 115.473 million kilos, up 16%.

“Chicken is easy to produce in a short period of time. Retail shops and fast food chains have a high demand for chicken. Imported chicken offers a competitive price and assures (a) stable supply and format,” BAI Director Ronnie D. Domingo said in a text message when asked for comment. — Vincent Mariel P. Galang

Sins of the Father

By Carmen Aquino Sarmiento

Movie Review
KALEL 15
Written and directed by Jun Robles Lana

ONCE AGAIN, Jun Robles Lana paints for us a soberly excoriating portrait of Philippine society, from the POV of one of its most vulnerable members: 15-year-old Kalel Fernandez (Elijah Canlas), who is HIV-positive, homeless, and sells sexual favors just to survive. He is the illegitimate son of Father George, a respected, elderly priest (Eddie Garcia). That is a knowingly mischievous dig at the institutional Catholic church’s obdurate stand against reproductive health (RH) rights, a major factor in the alarming rise in the Philippines of the incidence of teenage pregnancy, as well as of diseases such as HIV and cervical cancer. Note that RH includes comprehensive sexuality education for all, but especially for the youth who make up the majority of our population. RH also means ensuring the easy access to affordable means of protection, like condoms. Fr. George is more annoyed than concerned when he learns Kalel is HIV-positive. He gives him a small bottle of virgin coconut oil, and acts like he has done his duty by the boy.

Poor Kalel has no one to turn to. Certainly not his feckless, footloose, and fancy-free mother Edith (Jacklyn Jose, with impeccable comic timing, and obviously having fun), their small town’s aging hotsy-patootsy, who does not worry about her youngest child’s health, but rather over her non-existent reputation, should the community learn about Kalel’s disease. Her two children are at best, underpaid labor for her carinderia (roadside eatery). They work for their keep. Only Edith knows who the father of her older daughter Ruth (Elora Espano) is. Ruth might have followed in her mother’s footsteps, but she chose to have an abortion instead. This has not led to better life choices, as her boyfriend of the moment, Danny (Cedrick Juan), is a violently abusive shabu addict. Despite the siblings’ constant spats, they cling to one another. When Kalel loses his sister, he is truly, despairingly alone.

Elijah Canlas is one of our finest actors, regardless of age. He is intense while being transparently vulnerable. In a particularly poignant scene at the police station, when he sees the plateful of food which the officer-on-duty sends away, Canlas conveys his gnawing hunger and longing, through just a teensy lift of his head and a leaning forward of his torso. The slightest shifts in his gaze, a tremor about the lips, speak volumes more than the oratorical declamations and effortful physical exertions which audiences here generally mistake for good acting. Thus, there were complaints that this film was “slow.” It’s certainly not the feel-good or conventional cinematic product. Nonetheless, its all too brief commercial run is undeserved, as its story, though neither pleasant nor easy, is one which we should heed.

Kalel’s name, like a Binisaya version of the poet’s name, as in Gibran, evokes the pitiful aspirations of the underclass. One imagines that his own mother Edith, probably just liked the sound of the name Khalil, but had never read the poet, nor knew how to spell his name. Nonetheless, she considers herself fortunate that her second child was sired by their town’s priest. At least, Fr. George has the wherewithal to provide some support, no matter how minimal and perfunctory. Kalel attends a Catholic school at the parishioners’ expense, but that is practically the full extent of his priest-father’s paternal involvement. Fr. George’s emotional distance and virtual indifference, leave Kalel hungering and longing for the male gaze.

Robles Lana gives us a disturbing glimpse of the MSM (Men having Sex with Men) subculture on social media, where Kalel is something of a star. He thrives on the numerous likes his posts receive. Without a functional father, and having only his harpy of a mother, he finds affirmation in the unwholesome attentions paid to him by shadowy strangers, mostly older men, lurking on the internet. These risky but profitable encounters have afforded the boy luxuries beyond his means, such as comic books and gadgets, which his neglectful parents never gave him.

Cinematographer Carlos Mendoza’s austere black and white photography recalls cinema classics about other luckless and troubled youths, such a Truffaut’s The Four Hundred Blows (1959), though its shifting and shadowy sheen is more resonant of the late photographer Robert Mapplethorpe’s controversial imagery of homosexual hustlers, substance abusers, and other fringe types. This fits the bleakness of Kalel’s story: he also subsists along our society’s margins. Kalel 15’s sensibility might be the obverse of Larry Clark’s Kids which introduced Chloe Sevigny in the role of Jennie, a young girl who gets HIV from her first lover, a promiscuous boyfriend. The scene where the addict Danny gives Kalel and his high school barkada (gang of friends) hallucinogenic drugs, is reminiscent of the one in Kids where Fidget, a raver boy, makes the innocent Jennie swallow a pill more potent than “Special K” (the horse tranquilizer Ketamine). She passes out, and is raped. While he is high, Kalel reveals to his barkada that he is HIV-positive. Just as hypocrisy shrouds Kalel’s parents, his barkada’s loud protestations of sympathy and support at Kalel’s revelation prove to be mere lip service.

Abandoned by family and friends, Kalel takes charge of his life. He grows up too quickly: facing his mortality, while fending for his day-to-day survival. An indication of Canlas’s meticulous and seamless technique was how even his speaking voice was deeper than that of a typical 15-year-old’s. Inside, he was no longer a child. When the lesions from his Kaposi’s Sarcoma spread and become intolerably itchy, Kalel takes himself to the HIV clinic, because no one else will. The mild-mannered doctor observes that Kalel and his mother never came for counseling, but doesn’t seem overly concerned that this minor is in grave danger of falling through the cracks.

Although the Philippines is still a low-HIV country, our rate of infection is the fastest rising. Robles-Lana does not go the instructional film route. We may not like the things we learn about our society through Kalel’s story. But, as our national hero Dr. Jose Rizal wrote about the cancer in our society, of which the plight of those like Kalel is but one symptom: “Desiring your well-being which is our own, and searching for the best cure, I will do with you as the ancients of old did with their afflicted: expose them on the steps of the temple… And to this end, I will attempt to faithfully reproduce your condition, without much ado. I will lift part of the shroud that conceals your illness.” Now if only more of the movie-going public would look. Like Rizal’s novels, Kalel 15 should be required viewing for high school kids, their parents and teachers, whether they like it or not.

UAAGI, FOTON Motor Philippines end 2019 with ISO certification

THE ISO 9001:2015 Quality Management Systems certificate was officially awarded to United Asia Automotive Group, Inc. (UAAGI) and FOTON Motor Philippines, Inc. (FMPI) President Rommel Sytin during the company’s yearend celebration last Dec. 13 at Fontana Leisure Parks and Casino in Clark, Pampanga.

“We are proud to say that our company has obtained an established and documented quality management system, training of people, and periodic assessment or audit, to ensure effectiveness, adequacy and relevance of the system in UAAGI and FMPI,” shared Mr. Sytin.

UAAGI reached the Philippine shores on 2006. Since then, the company has been the sole and official distributor of FOTON vehicles including passenger vehicles; light-, medium-, and heavy-duty trucks; and heavy machinery in the country.

Ten years after its inauguration, it opened an 11-hectare assembly plant in Clark, Pampanga — the first and the only automotive production facility in Clark Freeport Zone.

From placing 12th on 2017, FOTON took a high leap and ranked 9th in the Philippines’ top automotive brands last 2018. It also finished 3rd in the light-duty truck segment race.

“As one of the leading automotive brands in the Philippines, it is vital for us to meet the terms of all local and international regulatory requirements. UAAGI and FMPI’s efforts to improve its operations showcase our commitment to protect our employees, customers, contractors and service providers,” Mr. Sytin added.

In November 2019, UAAGI officially announced its local distributorship of Chery, the largest passenger vehicle exporter in China. With all the concentrated developments throughout the years, UAAGI and FMPI has been an ideal marketplace where every customer has a fair chance of acquiring quality units at most affordable prices capped off with notable after-sales assistance.

“Continual improvement means there’s no end to the process. And I know that through my team’s hard work, we will be able to fulfill the requirements today and in the future. We will strive to identify current and future customer needs, to meet their requirements and to exceed their expectations,” Mr. Sytin closed.

CALAX 10-km segment to open before holidays

THE first segment of the Cavite-Laguna Expressway (CALAX) will be fully operational for the holidays, the Department of Public Works and Highways (DPWH) said.

After an inspection of the toll road over the weekend, Public Works Secretary Mark A. Villar said the 10-kilometer portion of CALAX from Mamplasan Interchange to Sta. Rosa City is scheduled for full operationalization by today.

“Starting next week, fully operational na siya… by Monday. Pipilitin natin na [We’ll do our best for it to be] fully operational before Christmas,” Mr. Villar told reporters on Saturday.

“I have already requested the concession company, MPCALA Holdings, (Inc.) to keep this section open so that our holiday goers can continue to enjoy this shortcut from Manila to Tagaytay City,” he added.

MPCALA started partial operations of the 10-kilometer segment of CALAX on Oct. 30. Once it is “fully operational,” this means permits would have been issued and the segment will be covered by MPCALA’s full time traffic management teams and 24/7 roadside services.

Mr. Villar said some 10,000 motorists are expected to benefit from the 10-kilometer section of CALAX once fully operational.

The whole CALAX project covers 45.3 kilometers of expressway linking the Manila-Cavite Expressway (CAVITEx) from Kawit, Cavite to the South Luzon Expressway (SLEx) at the Mamplasan Interchange in Biñan, Laguna.

The remaining portion of the toll road is still under construction and is scheduled for completion by the second quarter of 2022.

The P35.43-billion project is being undertaken by the Metro Pacific group through MPCALA, which is under Metro Pacific Tollways Corp. (MPTC).

MPTC is the tollways unit of Metro Pacific Investments Corp., one of three key Philippine units of Hong-Kong based First Pacific Co. Ltd., the others being Philex Mining Corp. and PLDT, Inc.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls. — Denise A. Valdez and Arjay L. Balinbin

Peso to climb on remittances

THE PESO is expected to rise this week on the back of the strong support from the surge of remittance flows this holiday season.

The local unit closed at P50.815 against the greenback last Friday, depreciating by 18 centavos from its P50.635 finish on Thursday, according to data from the Bankers Association of the Philippines.

The peso also weakened by 17.5 centavos from its close of P50.64 to a dollar a week earlier.

Dollars traded dropped to $835.75 million from $998.7 million on Thursday.

Rizal Commercial Banking Corp. (RCBC) Chief Economist Michael L. Ricafort attributed the peso’s performance to US data released last week.

“Stronger US initial jobless claims data also supported the latest gains in the dollar,” he said in a text message.

The number of Americans who filed for unemployment benefits slipped from more than a two-year high last week on labor market strength, Reuters reported.

Data from the US Labor department released on Thursday showed that initial claims for state unemployment benefits went down by 18,000 to a seasonally adjusted 234,000 for the week.

Reuters said although the drop did not unwind the jump by 49,000 seen last week, it likely does not indicate material shift in the labor market conditions as claims data tend to be volatile in the period after Thanksgiving.

Meanwhile, UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion blamed the peso’s decline on “global headwinds.”

“The market is cautious going into the holiday break with global headwinds like the impeachment of US President Donald Trump as potentially the main driver,” he said in a text message.

Reuters reported that after US Speaker Nancy Pelosi said she would not submit the impeachment case to the Senate until they have established how Republicans will manage the proceedings, Mr. Trump tweeted that he preferred an immediate trial.

“So after the Democrats gave me no due Process in the House, no lawyers, no witnesses, no nothing, they now want to tell the Senate how to run their trial,” he said on Twitter. “I want an immediate trial.”

The US House of Representatives approved last Wednesday two articles of impeachment against Mr. Trump. A trial next month to decide whether he will be convicted and removed from office is expected at the Senate, which is considered to be a “friendlier terrain” for the US president.

A major factor this week that could affect trading given the holiday season is the surge of remittances, according to RCBC’s Mr. Ricafort.

“The financial markets will be anticipating the surge in the conversion of OFW (Overseas Filipino Workers) remittances for Christmas holiday-related spending and also in preparation for the New Year holiday-related spending….,” he said.

Data from the Bangko Sentral ng Pilipinas (BSP) showed remittances hit a record high of $2.849 billion last December 2018.

“Since 2014, the trend of monthly cash remittances is upward, with notable peaks observed during the holiday (November-December) and enrolment seasons (April-June),” the BSP earlier said.

Latest data from the central bank showed cash remittances inched up by eight percent to $2.671 billion in October.

By type of worker, cash sent home by land-based workers increased by 3.8% to $19.436 billion year-to-date, while those sent home by those at sea increased by 7.5%to $5.422 billion, the central bank said in a news release.

Meanwhile, UnionBank’s Mr. Asuncion said the “market may move sideways during the holidays.”

For this week, RCBC’s Mr. Ricafort sees the peso playing around the P50.40-50.90 level, while UnionBank’s Mr. Asuncion expects the local unit to range from P50.60-50.90 versus the dollar. — L.W.T. Noble

USDA revises feed demand estimate for PHL after ASF containment measures

THE United States Department of Agriculture (USDA) said that feed demand in the Philippines next year may not be as significantly affected by African Swine Fever (ASF) as previously expected, citing effective controls on pork and pork products movements by the Philippine government, which has contained the spread of the disease.

The USDA said it “lowers its MY (milling year) 2019/2020 feed wheat consumption estimate from a decline of 300,000 MT to 100,000 MT (metric tons)” for the Philippines in its Grain and Feed Update report.

The Philippine Department of Agriculture implemented a zoning plan outlining restrictions on the movement of live animals, pork and pork products.

The USDA also noted that the smaller-than-forecast decline in feed demand will be offset by a switch to commercial feed by backyard raisers who had previously used swill. Hog raisers from unaffected parts of the Philippines like the Visayas and Mindanao are also expected to seek more feed “as they ramp up production to serve the pork needs of Luzon.” — Vincent Mariel P. Galang