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BusinessWorld Insights to uncover lessons from pandemic

THE Philippine business environment is now almost unrecognizable after over two months of lockdown due to the coronavirus disease 2019 pandemic (COVID-19). Businesses are adapting to a “new normal,” despite disruptions in supply chains, new consumer norms and a growing reliance on digital technology. It is the job of leaders and visionaries to blend the tried-and-true conventions of the past with the lessons learned from this challenging period.

BusinessWorld, the country’s premier business daily, is continuing its weekly BUSINESSWORLD INSIGHTS online forum series starting May 27. The second phase will highlight the lessons to be learned from the impact of COVID-19 on key sectors such as retail, logistics and e-commerce; healthcare and welfare system; and labor market and micro, small and medium enterprises (MSMEs).

The online forum series seeks to give a comprehensive look at the economic fallout and help the country prepare for post-COVID-19 recovery by gathering high-caliber speakers and experts for an intelligent online discussion, moderated by BusinessWorld’s veteran editors.

The theme of BUSINESSWORLD INSIGHTS’ second phase is “Winning the Fight: COVID-19 Lessons,” with the following sessions: “Beyond Survival: Charting the Path to Business Recovery” on May 27; “Improving the Country’s Healthcare and Welfare System” on June 3; and “Focusing on the Value of the Labor Market and MSMEs” on June 10.

The May 27 session will cover the pandemic’s impact on key industries such as manufacturing, retail and logistics, and how companies are planning to bounce back and grow further.

Confirmed speakers include Simon Wintels, partner at McKinsey Singapore; Gary De Ocampo, chief executive officer of Kantar Philippines; Nicky Gozon, director of Entrego Express Corporation; and Winn Everhart, president and general manager of Coca-Cola Philippines. Another invited speaker is Gil Genio, chief technology and information officer and chief strategy officer of Globe Telecom.

The second session on June 3 will discuss issues surrounding the beleaguered healthcare system, while the third leg on June 10 will reevaluate the value of the Philippine labor market and MSMEs.

The online forum series is scheduled every Wednesday at 11 a.m. and streamed live and free on the Facebook pages of BusinessWorld and The Philippine STAR. It will also be uploaded on BusinessWorld’s website (www.bworldonline.com) and YouTube account.

BUSINESSWORLD INSIGHTS: An Online Forum Series is made possible by sponsors SM, United Laboratories, Globe Telecom and Entrego Express Corp.; eLearning platform partner Olern; partner organizations Management Association of the Philippines, Philippine Chamber of Commerce and Industry, Philippine Association of National Advertisers, Bank Marketing Association of the Philippines; and media partner The Philippine STAR.

For more information, contact Shai Cordero at 09979954734 or smcordero@bworldonline.com.

Are we flattening the COVID-19 curve?

Are we flattening the COVID-19 curve?

Philippines may benefit from US-China rift

RENEWED tensions between the United States and China could prove to be a boon for the Philippines, according to Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno.

“This current wave of revamping of global supply chains opens a window of opportunity for the Philippines to benefit from trade redirection and relocation of production sites,” Mr. Diokno said in a text message to reporters on Saturday.

Mr. Diokno said that electronic exports performed well in 2019 despite the US-China trade war. “This phenomenon can be attributed to the Philippines’ low exposure to products targeted directly by US tariff actions against China. The exposure is estimated at a low of 0.5%,” he said.

In 2019, exports grew by 1.5% to $70.33 billion from the $69.31 billion in 2018, according to data from the Philippine Statistics Authority.

“Not surprisingly, the Philippines is expected to be among the least affected by the US-China trade tensions. This supports IMF’s view that the country’s low participation in global trade as well as in global value chains relative-to-peers seems to explain why the Philippines has not been negatively impacted by the US-China trade war,” Mr. Diokno said.

As the US-China trade spat continues, there may have been a shift of investments and supply chains to some ASEAN countries, according to Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort.

“Vietnam could have benefitted more in terms of FDIs (foreign direct investments) shifts because of its proximity to China’s border to realize lower tariffs,” he said in an e-mail.

FDI inflows to the Philippines dropped by 23.1% to $7.647 billion in 2019, with analysts blaming this to global uncertainties, regulatory risks, and the unclear path for the tax reform that took its toll on investor sentiment.

UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion said the country should look to improve its weaknesses to attract more investments.

“Our lack of infrastructure and presence of web suppliers supporting these potential locators are keeping us from getting a decent share of investments,” he said.

To make the country more attractive for those seeking refuge from trade tensions, legislation that focuses on tax reforms could be the key for the Philippines to entice investors, Mr. Ricafort said.

“The proposed CREATE (Corporate Recovery and Tax Incentives for Enterprises Act) Bill that aims to reduce Philippine corporate income tax to 25% (from 30%) as early as July 2020 would help attract more foreign direct investments into the country and provide greater certainty for foreign investors,” he said

CREATE is a revised version of the Corporate Income Tax and Incentives Rationalization Act (CITIRA) Bill, which remains pending at the Senate.

According to Mr. Ricafort, the Philippines’ improving economic and credit fundamentals paired with favorable demographics is also one of its key strengths.

Meanwhile, Mr. Asuncion said the country should determine whether it wants to be a “manufacturing hub, a financial services center, or a digital valley of sorts.”

“The new normal is coming. It would be a disservice to the country if we wait for it to come rather than help shape it,” he added. — Luz Wendy T. Noble

Tan seeks ‘more time’ for Sangley airport

By Arjay L. Balinbin
Reporter

LUCIO C. TAN’S MacroAsia Corp. and its Chinese partner are again asking for more time to submit the post-qualification requirements for the $10-billion Sangley Point International Airport (SPIA), said the provincial government of Cavite, which remains keen on the project.

“They asked for an extension which we are inclined to give them,” Cavite Governor Juanito Victor “Jonvic” C. Remulla told BusinessWorld in a phone message on Sunday when asked if the consortium has recently expressed its intent to push through with the submission of the documents on June 11.

The Cavite government had approved the first request of MacroAsia and partner China Communications Construction Co. Ltd. (CCCC) to extend the submission deadline of the post-qualification requirements, which were supposed to be submitted 60 days after it received the notice of award on Feb. 14.

The province gave the consortium more time until the second week of June to process and submit the required documents before a joint venture development agreement is signed.

“Yes, tuloy pa din po (the project is still on),” Cavite’s Public-Private Partnership Selection Committee Legal Officer Jesse R. Grepo told BusinessWorld in a phone message on May 18 when asked if the project would still push through.

“The consortium has been given 60 days or until 11 June 2020 within which to submit their post qualification documents. Nevertheless, the consortium is encouraged to submit the same as early as and to the maximum extent possible given the circumstances, as undertaken in their letter request,” he said, referring to the consortium’s first request for extension.

On Sunday, Mr. Remulla said: “They informed our transaction adviser that they might need more time.”

“We are caught in the middle of the pandemic with no clear path to resumption of normal life. We will study their request and give an answer in a few days,” the governor added.

Mr. Remulla has said that the province was hoping to break ground with its joint venture partner for the first phase of the airport project in the second quarter of the year.

The first phase of the SPIA project, which will cost $4 billion, includes the construction of the Sangley connector road and bridge to connect the Kawit segment of the Manila-Cavite Expressway (CAVITEx) to the international airport.

Phase 1 also involves the construction of the airport’s first runway, which can accommodate 25 million passengers yearly, helping to decongest the Ninoy Aquino International Airport.

Cavite expects the airport to start fully operating by 2023, with partial operations to start a year earlier. The fourth runway will be opened after six years.

The same consortium will work on the other two phases of the project, but there may be contract renegotiations, according to the Cavite provincial government.

The second phase, which will cost about $6 billion, involves the construction of two more runways, giving the airport an annual capacity of 75 million passengers.

The last phase is the expansion to four runways, bringing capacity to 130 million passengers.

P28-B loss seen in drug price control

THE Pharmaceutical and Healthcare Association of the Philippines (PHAP) called on the government to recall the policy on price control on medicines that could lead to foregone revenues of P28 billion.

In a statement, PHAP said the industry estimates a P57-billion drop in sales from P200 billion once price control is fully implemented.

Projected government revenue losses would be P4 billion in foregone customs duties; P7 billion in lost value-added tax; and P17 billion in corporate taxes, according to the association.

“The EO does not benefit the public in the end because of the formula used to compute the price adjustments. We appeal that the measure be withdrawn until further studies especially at this time when the government needs funds to fight COVID-19,” it said.

President Rodrigo R. Duterte in February issued Executive Order No. 104 or “Improving the access to healthcare through the regulation of prices in the retail of drugs and medicines,” which controls maximum retail price (MRP) and/or maximum wholesale price (MWP) of medicines of 133 drug formulas.

The EO, which will take effect in June, will slash prices of medicines from the manufacturer’s level but not all prices will be reduced at the patient level, according to PHAP.

The association also said that price control had not been effective “based on global experience.”

“It is a populist proposition but discourages production, creating scarcity that will likely hurt those in need of the medicines the most, and shrinks an industry. We continue to appeal for a thorough review on the impact of this policy,” the group said.

It urged the government to continue the practice of bulk buying and price negotiation “to assure both supply and price stability.”

According to the EO, price cap is applicable to drugs that address the health of the public, particularly those that account for leading causes of morbidity and mortality, have high price differentials to international prices, have limited competition in terms of lack of generic counterparts, and medicines where the innovator product is the “most expensive yet most prescribed and/or dispensed in the market.”

The MRP will be imposed on all retail outlets, including drugstores, hospitals, pharmacies, health maintenance organizations, convenience stores, and supermarkets, while MWP will be imposed on all manufacturers, wholesalers, and distributors.

“No public or private entity shall be allowed to sell, reimburse or demand from the public or patients payment in an amount higher than the MRP or MWP, as the case may be,” the EO read. — Vann Marlo M. Villegas

Rates of T-bills, T-bonds likely to decline

RATES OF government securities on offer this week will decline further as investors’ flight to safer assets continues to fuel demand.

The Bureau of the Treasury (BTr) is set to borrow P20 billion via Treasury bills (T-bills) on Tuesday, broken down into P5 billion each for the 91- and 182-day papers and P10 billion via 364-day instruments.

On Wednesday, the BTr will auction off P30 billion in reissued five-year Treasury bonds (T-bonds) with a remaining life of four years and four months and a coupon of 4.25%.

A bond trader said over the weekend that rates of the T-bills will likely move “sideways to 10 basis points (bps) lower from previous auction” while for the reissued T-bonds, rates could settle within 2.8-2.9% range.

Security Bank First Vice-President and Head of Wholesale Treasury Sales Carlyn Therese X. Dulay said the T-bills could yield rates 5-10 bps lower as strong demand for government securities persists, with bids seen reaching “at least two to three times” more than the initial offer.

Last week, the Treasury hiked the volume of T-bills it awarded to P24 billion from the programmed P20 billion as total bids hit P103.8 billion.

It awarded P7 billion via three-month papers out of total tenders worth P29 billion, yielding an average rate of 2.09%, lower than the 2.269% fetched in the previous auction.

The Treasury raised another P7 billion in six-month papers from total bids of P33.7 billion at an average rate of 2.193%.

It likewise made a full award of the P10 billion in one-year securities on offer as total bids reached P40.77 billion and its rate declined to 2.653%.

Meanwhile, Ms. Dulay said the reissued five-year bonds could fetch lower rates between 2.7% and 2.8% on expectations of oversubscription.

The last time the BTr offered five-year securities was on March 3 where it raised P30 billion at a lower average rate of 4.018% from 4.227% previously.

The tenor attracted bids worth P83.511 billion at that auction, prompting the Treasury to award another P10 billion via the tap facility.

Kevin Palma, peso sovereign debt trader of Robinsons Bank Corp., said robust demand will pull down rates anew as robust liquidity in the market will cause investors to crowd safe-haven assets.

“Bond bulls were in the frontlines in the past few weeks. It’s because there’s so much liquidity in the financial system. That said, market players may continue to hunt for bargains on the short- to belly-end of the curve to put their excess cash to work to push GS (government securities) yields to multi-year lows,” Mr. Palma said via Viber on Saturday.

The government is planning to borrow P170 billion from the local market this month: P110 billion via its weekly T-bill auctions and the remaining P60 billion via T-bonds to be offered fortnightly. — B.M. Laforga

PayMaya eyes public vehicles for cashless payment

DIGITAL payments firm PayMaya Philippines, Inc. is in talks with the Department of Transportation (DoTr), the Land Transportation Franchising and Regulatory Board (LTFRB) and some taxi operators for a possible partnership to implement cashless payments in public transportation as a measure against the spread of the coronavirus disease 2019 (COVID-19).

“As part of our many digitization engagements now with the government, consumers, and enterprises, we have been in talks with the LTFRB, the DoTr, and initially some taxi operators given the mandate released by the LTFRB to implement cashless and contactless transactions in public utility vehicles (PUVs),” PayMaya Founder and Chief Executive Officer Orlando B. Vea told BusinessWorld in an e-mailed reply to questions on May 20.

He said cashless transaction in public transportation is an “essential component” of the overall set of measures meant to protect both drivers and commuters. “PayMaya is more than ready to help transport providers in implementing this measure among their drivers and fleet.”

PUV drivers can sign up for a PayMaya account and immediately accept or receive payments from other users through the Send Money function of the platform via QR or mobile number for free.

PayMaya, Mr. Vea added, also offers transport operators a payroll disbursement technology, extending the benefit of cashless transactions to their internal operations.

He also said it would be wise for the government to implement cashless payments in PUVs nationwide, adding that PayMaya is “more than ready to accommodate the projected surge in new users” coming from the transport sector.

The LTFRB has issued Memorandum Circular No. 2020-018 mandating the collection of fares in taxi units and transportation network vehicle services (TNVS) as strictly through cashless payment or through online payment facility only.

“In the past, we have also partnered with bus and taxi companies in Metro Manila and also in other areas such as Baguio and Cebu, and we have also enabled the Araneta Bus Port in helping them accept cashless payments through credit and debit cards as well as via PayMaya QR. The technology is here, and we are ready to partner with government and transport operators to enable them with cashless payments acceptance,” Mr. Vea explained.

During the community quarantine period, PayMaya’s combined user volume for consumer wallet, enterprise, and agent network businesses have doubled year-on-year, he said.

“We have ably delivered efficient and reliable services to them for their online groceries, bills payments, mobile prepaid reloading, and even the financial aid being distributed by national government agencies and local government units,” he added. — Arjay L. Balinbin

How to do a fashion show online

MISSING the things that the virus has taken away — parties, live events, even being seen barefaced — brought more than a thousand viewers to Facebook Live last week to watch Rajo Laurel: Runway Online, a live fashion show by designer Rajo Laurel. This was done in collaboration with Robbie Carmona, founder and CEO of Saga Events, the events company which staged the show.

Prior to the pandemic, the company staged many high-flying events, but obviously, things are set to change. “The events industry has always brought people together: to share beautiful stories, create unforgettable memories, and form meaningful connections,” said Mr. Carmona in an introduction. “In order to keep this human connection alive, we must continue to inspire and be inspired. We must continue to harness creativity and support one another.”

The clothes had been worked on by Mr. Laurel six months before, forming a collection called Hacienda. The designer was inspired by the province of Batangas. “It is my happy place. This is where I find peace and solace. Where I take up new endeavours such as gardening and hiking. It is a collection that celebrates clean air, songbirds and sunshine,” said Mr. Laurel in an e-mail to BusinessWorld.

According to Mr. Carmona, the show was planned after model Ria Bolivar sent him a post about designers going online for the pandemic. Inspired, he called up Mr. Laurel and asked him if he was ready to do a fashion show on his birthday (May 19). The show was staged two weeks after the phone call.

The planning wasn’t all light and birdsong, however: clothes were sent to the models — along with detailed styling instructions — to model at their own homes. Hairstylist Jing Monis and Mr. Laurel’s sister, makeup artist Gela Laurel, made video tutorials so the models could do their own hair and makeup. “We then gave the models specific instructions on how to prepare themselves for the show. We also asked them to shoot their runway walk in specific times of the day to have consistent lighting,” said Mr. Laurel in an e-mail. “It was a testament of patience, fortitude and love.”

The clothes showed an airy lightness even in more structured selections like a wide-lapelled jacket, thanks to the choice of very enviably breathable fabrics, in a palette of nudes, pastels, and dusty colors. Mr. Laurel says the collection had been in preparation a few months before the pandemic, but one can see how fashion really does serve to show in which direction winds blow: there were shorts suits for men, with a springy, light cropped jacket which are perfect to use for work-from-home meetings. The loose fits on dresses suggest casual airs, but details like pleating and suiting elements still have a patrician flair to them.

Mr. Laurel said about doing a show remotely: “Given our current circumstances, this was one of the ways we could continue telling our stories and sharing our talents. Safely, without compromising anyone’s health. It is not the most ideal way, however, for now this is the best way we can connect with our colleagues, friends and clients.”

To be fair as well to the show, it achieves something a live show cannot do which is to suggest the context where the clothes may be worn. This is seen in an airy paneled dress a model used to walk down a tree-lined street, suggesting a quiet life away from it all, while the fabric around her was blown lightly by the wind.

“One has to be pragmatic given these challenging times. Practicality is now on top of mind. This experience is an opportunity for all of us to begin, to start strong,” said Mr. Laurel.

Changing times call for changing ways, and we asked Mr. Laurel if virtual shows might be the way to go for the future. In the months and weeks preceding the coronavirus wave that hit Italy, some designers had already told their audiences to stay home and instead streamed their shows. “There is something spellbinding with a real runway show,” said Mr. Laurel. “However, for now this is how we must proceed,” he said. “The virus is still out there, and without a vaccine we cannot go back to our old ways. However, nothing will replace a live fashion show. This experiment is one way to do it. However I know that there will be other formats that our young designers will think of and execute in the most magical ways.

“Fashion is the language that we choose to express ourselves in and our industry speaks it so fluently. We do this all for love and that is why it is very special.”

The collection can be viewed at the House of Laurel’s Instagram page @houseoflaurel. A portion of the proceeds from sales of items from the Hacienda collection will be donated to the Philippine Red Cross-Makati. — Joseph L. Garcia

ECB signals at June stimulus

EUROPEAN CENTRAL Bank (ECB) officials have given up on the idea of a swift economic rebound from the pandemic and are ready to add stimulus again next month if new information suggests existing efforts aren’t enough.

Policy makers agreed at their April 30 meeting that a “V-shaped recovery could probably already be ruled out at this stage,” though their emergency asset purchases prevented the likelihood of a self-reinforcing downward spiral, according to an account of the virtual discussion.

“At the June meeting, more information would be available, including new Eurosystem staff macroeconomic projections,” the account showed. “The Governing Council would have to stand ready to adjust the Pandemic Emergency Purchase Program and potentially other instruments if it saw that the scale of the stimulus was falling short of what was needed.”

Policy makers decided at the meeting to ease the terms of their long-term loans to banks and introduced a new liquidity tool, but opted against expanding quantitative easing. Most economists expect the €750-billion ($815-billion) emergency bond-buying program will be increased, perhaps as soon as the next policy meeting on June 4.

The ECB has pledged to buy more than a trillion euros of debt this year — the most in its history — using the pandemic program and an earlier one. The institution has led the European-level response, with most fiscal action coming only from national governments.

A concern was voiced in the meeting that such large-scale interventions in sovereign bond markets could give rise to “fiscal dominance’” — encouraging irresponsible spending by governments.

Bank of England Governor Andrew Bailey recently pushed back against similar concerns even while acknowledging that his central bank’s policies are supporting UK government borrowing.

The Governing Council, according to the ECB report, agreed that “fiscal policy also needed to play an essential role.”

It may get its wish. German and French leaders finally proposed a €500-billion aid package this week that might ease some of the pressure, though it requires approval by all 27 European Union member states and would only kick in next year.

Philip Lane, the ECB’s chief economist, said later on Friday that central banks have to be more aggressive in dealing with shocks that depress inflation — such as the current one — than those that boost it.

“The tools to tighten the monetary stance are more effective than the tools to loosen the monetary stance,” he said.

He also said the institution hasn’t forgotten another key task it had planned for 2020 — a reassessment of its overall policy strategy — calling it a “high priority.” — Bloomberg

Vatican Museums, to reopen from June 1

VATICAN CITY — The Vatican Museums will reopen on June 1, the Vatican said on Saturday, ending a closure caused by the coronavirus lockdown that has drained the Holy See’s coffers.

A statement said the Museums, which house some of the world’s greatest Renaissance masterpieces as well as ancient Roman and Egyptian artifacts, can be visited from the beginning of June, though only by making on-line reservations in order to control the number of people.

Visitors will have their temperatures checked and will have to wear masks and use hand sanitizer. Staff will wear masks and gloves and health workers will be on hand.

Similar conditions will apply to visitors to the papal summer residence at Castel Gandolfo south of Rome.

Italian museums began reopening on May 18 as part of a staged easing of lockdown measures in the country where nearly 33,000 people have died from the virus.

The pandemic has drastically slowed the flow of funds to the Vatican’s coffers. The Museums received some 7 million visitors last year and are the Holy See’s most reliable source of income, previously generating an estimated $100 million yearly.

Even after the reopening, officials fear that enhanced security measures, social distancing requirements, new health regulations and an expected dearth of international tourists will erode ticket and souvenir sales. — Reuters

Ayala forms group to support SMEs

THE Ayala Group has launched a program to support small- and medium-sized enterprises (SME), starting with P766 million in free services and waived fees.

In a statement over the weekend, the Ayala Group said it had formed the Ayala Enterprise Circle, joined by 250,000 SME partners to which it is reaching out to assist as they suffer from the effects of the coronavirus disease 2019 (COVID-19) pandemic.

“We envision the Ayala Enterprise Circle as a network where you, our valued SME partners, can have access to exclusive Ayala Group solutions and offerings, expert mentorship from industry leaders, online dialogues and masterclasses, and business-matching and co-marketing opportunities,” Ayala Corp. (AC) Chairman and Chief Executive Jaime Augusto Zobel de Ayala was quoted in the statement as saying.

The companies forming the Ayala Group are Ayala Land, Inc. (ALI); Bank of the Philippine Islands (BPI); Globe Telecom, Inc.; and Ayala Healthcare Holdings, Inc. (AC Health), among others.

As of last week, the group has allocated P766 million in free services and business operation fees for its SME partners. The support includes the P280-million rental condonations of ALI to more than 2,400 SME tenants in Ayala Malls.

Other companies in the Ayala Group have similarly extended help. BPI has waived interbank transfer fees for the duration of the enhanced community quarantine. Ayala Malls, together with online retailer Zalora, is studying e-commerce models to give SMEs an alternative digital channel for operations.

“Across the Ayala Group, we have a renewed commitment to all of our partner SMEs, who have been with us through so many years… We want to assure them all that we… remain steadfast in our support, and we thank them for their continued trust in us,” AC Chief Human Resource Officer John Philip S. Orbeta said in the statement. Mr. Orberta is also the head of the Ayala Enterprise Circle.

Data from the Philippine Statistics Authority as of 2018 showed micro-, small- and medium-sized enterprises form 99.52% of the country’s business enterprises, providing jobs to 63.19% of the country’s total workforce.

AC, which has interests in businesses including real estate, banking, telecommunications and utility, booked a net income of P6.7 billion in the first quarter, down 17% year-on-year due to the economic slowdown amid the COVID-19 pandemic. — Denise A. Valdez

Peso likely to weaken vs dollar

THE PESO is likely to weaken this week as markets continue to track heightened tensions between the US and China as well as the upward correction in oil prices.

The local unit finished trading at P50.70 against the dollar, shedding nine centavos from its P50.61 close on Thursday, according to data from the Bankers Association of the Philippines.

However, the currency gained six centavos week on week compared to its P50.76-per-dollar close on May 15.

The weaker peso came as the market tracked escalating tensions between US and China, according to UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion.

“Investors seemed to stay on the sidelines as the US-China trade deal tensions have continuously risen in the past days,” Mr. Asuncion said in a text message.

Republican and Democratic US senators said on Thursday they would introduce legislation to impose sanctions on Chinese officials for violating Hong Kong’s independence, after Beijing moved to impose a new security law on the former British colony.

The bill, to be introduced by Republican Senator Pat Toomey and Democrat Chris Van Hollen, would also impose secondary sanctions on banks that do business with entities found to violate the law guaranteeing Hong Kong’s autonomy.

Apart from heated US-China relations, the correction in oil prices also took its toll on the peso, according to Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp. (RCBC).

“Peso was also weaker after global crude oil prices reached new two-month highs,” Mr. Ricafort said in a text message.

Reuters said Brent crude was up by 14 cents or 0.4% to $36.20 a barrel by 0040 GMT on Friday, after gaining nearly 1% on Thursday. The contract is heading for a more than 10% climb for the week.

The price of West Texas Intermediate crude was likewise up five cents or 0.2% to $33.97 a barrel, having gained more than 1% in the last session. The US benchmark is on track to seal a weekly increase of around 15%.

In the coming week, peso-dollar trading will be affected by market sentiment on key US and local data, according to UnionBank’s Mr. Asuncion.

“Peso is expected to move sideways as the markets wait for more major economic data moves this week, including the local budget balance as well as the US consumer confidence,” he said.

The US consumer confidence index dropped to its near six-year low reading of 86.9, no thanks to the pandemic. This is the lowest reading since June 2014 and also lower than the 118.8 seen in March.

Meanwhile, the Bureau of the Treasury will report the April budget balance data on May 26.

For RCBC’s Mr. Ricafort, the market’s sentiment on heightened tensions between US and China and the movement of oil prices is expected to guide currency trading this week.

“Major catalysts for the peso also include developments related to further reopening of economies and any developments on possible cure or vaccine on COVID-19,” he added.

Metro Manila Council Chairman and Parañaque Mayor Edwin L. Olivarez earlier said he will endorse the placement of Metro Manila under general community quarantine by June 1, saying the impact of the pandemic on the National Capital Region is “horrible and horrifying.”

For this week, Mr. Ricafort gave a forecast range of P50.50 to P50.90 while Mr. Asuncion bet that the local unit will trade within the P50.60 to P50.90 levels. — L.W.T. Noble with Reuters

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