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Peso rises versus dollar on weak US labor data

THE PESO strengthened slightly against the dollar on Monday due to weak labor data in the US and amid “very quiet” trading.
The local unit closed Monday’s session at P52.20 versus the greenback, five centavos higher than the P52.25-per-dollar finish last Friday.
The peso opened the session flat at P52.25 per dollar and dropped to as low as P52.28 intraday. Its best showing was logged at P52.17 versus the US currency.
Dollars traded thinned to $833.54 million from the $1.233 billion that switched hands the previous session.
“The peso strengthened on broad dollar weakening after the US non-farm payrolls data came in at an unexpected low of 20,000, which was way below market expectations,” a trader said in an e-mail.
The US economy added only 20,000 jobs in February, even as unemployment rate fell to 3.8%, US Labor Department reported last week.
The non-farm payrolls were way lower than the 180,000 market consensus and was the lowest job creation in more than a year or since September 2017.
“The dollar opened a little lower, given the dollar index’s move over the weekend due to weak non-farm payroll data in the US,” another trader said.
Throughout the day, the trader said the local unit moved mostly between P52.23 and P52.24 versus the dollar, although it reached its intraday low of P52.28 during the first 30 minutes of the trade.
The trader added that the market was “somehow very quiet” on Monday as it traded within a narrow range.
“There’s no news that made the markets move. Maybe the market is looking for fresh leads,” the trader added.
For today, the second trader expects the peso to move between P52.10 and P52.40 against the greenback, while the other gave a slightly slimmer range of P52.10-P52.30.
“The local currency might trim its gains ahead of likely firm US inflation figures for February 2019,” the first trader noted. — K.A.N. Vidal

PSE index declines on net selling, lack of drivers

By Arra B. Francia, Reporter
THE MAIN INDEX moved further down the 7,700 level yesterday amid a lack of fresh catalysts that could boost investor sentiment.
The 30-company Philippine Stock Exchange index (PSEi) plunged 1.13% or 88.39 points to close at 7,708.72 on Monday, extending losses seen in the previous session. The broader all-shares index likewise dropped 0.76% or 37.04 points to 4,780.18.
“PSEi continued to drop on a lack of catalysts and a transition to net foreign selling,” Papa Securities Corp. Sales Associate Gabriel Jose F. Perez said in an e-mail.
Foreign investors turned sellers with net outflows of P273.48 million on Monday, snapping their three-day net buying streak which ended at P60.09 million last Friday.
“A lack of catalysts continues to keep investors on the sidelines. Even foreign investors took money off the table again today,” Eagle Equities, Inc. Research Head Christopher John Mangun said in an e-mail on Monday.
“There are a few companies that are bucking the trend and continue to rise despite the dismal performance. This trend may continue in the following days. The strategy is to watch out for the outliers,” Mr. Mangun added.
The list of 20 most actively traded stocks showed only five gainers, while there were 12 decliners and three unchanged. Shares that advanced include San Miguel Food & Beverage, Inc. (up 2.54%) and Alliance Global Group, Inc. (up 2.46%).
The PSEi followed the negative sentiment seen in Wall Street indices last Friday. The Dow Jones Industrial Average went down for the fifth consecutive session by 0.09% or 22.99 points to 25,450.24, marking its longest losing streak since June 2018. The S&P 500 index declined 0.21% or 5.86 points to 2,743.07, while the Nasdaq Composite index edged lower by 0.18% or 13.32 points to 7,408.14.
Markets overseas have been reacting to fears of a global economic slowdown, following a disappointing US jobs report and lower Chinese exports data last week. The European Central Bank likewise cut growth its forecasts for 2019.
Back home, all sectoral indices ended in negative territory, led by mining and oil which fell 1.67% or 136.22 points to 8,002.93. Industrials shed 1.51% or 175.41 points to 11,404.98; holding firms declined 1.51% or 118.04 points to 7,680.72; financials went down 1.44% or 25.39 points to 1,735.47; services dipped 0.31% or 4.94 points to 1,545.70; and property declined 0.07% or 3.11 points to 3,942.57.
Turnover was slim at P5.48 billion after some 692.47 million issues switched hands. However, this was still higher than the previous session’s P5.30 billion.
Decliners were more than double the advancers, 128 to 63, while 47 names were unchanged.
“Erratic net foreign inflows, coupled with more weakness in US markets could dampen sentiment moving forward,” Papa Securities’ Mr. Perez said.

PNP-HPG to be deployed as gov’t gets tougher on illegal transport, parking

THE PHILIPPINE National Police Highway Patrol Group (PNP-HPG) and several government agencies will intensify the crackdown on colorum vehicles and other causes of traffic congestion in the capital. The Department of Transportation (DoTr) signed a deal with the Department of Interior and Local Government (DILG) on Monday to formalize the designation of the PNP-HPG as the enforcement arm of the agency. In a statement, the DoTr said the signed commitment requires the PNP-HPG to support the Inter-Agency Council for Traffic (i-ACT) by deploying 300 uniformed personnel to provide logistical mobility within the National Capital Region. PNP-HPG head Chief Supt. Roberto Fajardo, in a press briefing at Camp Crame on Monday, said aside from cracking the whip on colorum vehicles, they will also “clear the main thoroughfares of illegal parking.” The other member agencies of I-ACT include the Metropolitan Manila Development Authority, Metro Manila Council, Land Transportation Office, Land Transportation Franchising and Regulation Board, and the Philippine Coast Guard. — Vince Angelo C. Ferreras and Denise A. Valdez

Comelec-Iloilo City cracks down on illegal campaign posters

MORE THAN three weeks since the start of the 2019 campaign period for national candidates, hundreds of illegal campaign posters were removed in Iloilo City. The Commission on Elections (Comelec) in Iloilo City, together with Task Force Anti-Squatting and Illegal Structures and the Philippine National Police, has so far undertaken five Operation Baklas operations, with the most recent at the Plaza Libertad. “Here in Plaza Libertad we have noted a lot of violations like out of place campaign posters and some lack structures which was supposedly intended to hold the posters,” said Comelec-Iloilo City Election Assistant Jonathan G. Sayno. He added that some of the illegal posters went over the designated areas or were overlapping. Mr. Sayno also warned candidates that they would tear down all sorts of posters by politicians, including those that are promoting products or services but emblazoned with the bets’ photos. He added that even if the poster does not bear the word “vote,” Comelec will still tear down these materials. Meanwhile, operations against illegal posters of local candidates will start on March 29. — Emme Rose S. Santiagudo

80 loose firearms seized in Cavite

THE PHILIPPINE National Police (PNP) collected 80 loose firearms and potential instruments of violence during its recent 10-day focused operations in Cavite. The illegal weapons include confiscated, seized, recovered and surrendered firearms with delinquent registration, and others confiscated from unauthorized individuals through search warrant, checkpoint and anti-crime operations. “All the firearms confiscated by the Cavite PPO (provincial police office) ran up to 80 firearms. Twenty-eight of them were the result of search warrant and in these… the most prominent personality involved is barangay captain Jaime Hembrador in Dasmariñas City for poking his firearms to his constituents,” said Police Regional Office 4A (Calabarzon) Director Chief Supt. Edward Caranza in a press briefing at Camp Crame on Monday. The 52 others, he said, were surrendered as a “result of our effort to right those who have failed to renew their firearms (licenses). For his part, PNP Director General Oscar D. Albayalde said, “By taking away these instruments of violence from the hands of unauthorized individuals and criminal elements, we are making proactive steps to mitigate the possibility of involvement of these firearms in criminal activity and election-related violence.” The election gun ban period, which also covers the suspension of issuance of gun licenses, started last Jan. 13 and will be in effect until June 12. — Vince Angelo C. Ferreras

Over 2,000 athletes to join Ironman 70.3 in Davao

UP TO 2,200 athletes from 38 countries are expected to participate in the Ironman 70.3 triathlon event to be hold in the neighboring cities of Davao, Panabo and Tagum, and Carmen town on March 22-24. Davao City’s first hosting of the Ironman last year received a 90.2% rating, which is 2.77 percentage points higher than the present global standards, according to Sunrise Events Inc. General Manager Princess Galura. “This (year) is also 400 participants more than last year’s 1,800. We can attribute this to Davao City getting a more than 90% rating last year,” she said. Davao City is the official sponsor of the following events: Irongirls, Ironkids, and the Alveo Ironman 70.3 Davao Powered by Petron, a licensed and sanctioned triathlon event of the World Triathlon Corporation. “The said events are part of the sports development and tourism promotions of Davao City,” Ms. Galura said. As such, she added, these events will showcase the scenic sights, hospitable people, and abundant culture, not only of the city but the entire Davao Region, Mindanao, and the Philippines as a whole. Mayor Sara Duterte-Carpio has issued Executive Order No. 04 for the temporary closure of certain roads on various dates during the race, including the “Davao City-Panabo City Road from the intersection of J.P. laurel Avenue and R. Castillo St. (Alcantara) up to the boundary of Davao City and Panabo City (Lasang) and the northbound lane from the intersection of J.P. laurel Ave. and R. Castillo St. up to F. Torres St. as well as R. Castillo St.” — Carmencita A. Carillo

Mt. Apo Cotabato trails temporarily closed to prevent forest fires amid El Niño

THE THREE trails in Cotabato going up to Mt. Apo have been temporarily closed to avoid forest fires amid the ongoing dry spell brought about by El Niño. The closure, which takes effect immediately, was approved by the Protected Area Management Board (PAMB) in a meeting last March 8. The three trails have entry points from the towns of Makilala and Magpet, and Kidapawan City. The Department of Environment and Natural Resources Region 12 (DENR-12), in a statement, said all “trekking, climbing, camping and tree planting activities” will not be allowed until weather bureau PAGASA “lifts its advisory on El Niño in Western Mindanao.” Based on PAGASA’s El Niño Climate Outlook for Mindanao Advisory No. 4, the dry spell will likely “continue until April- May-June 2019 season, and various climate models prediction still suggest the likely persistence of dry condition, dry spell and drought over most areas in Mindanao in March- April-May 2019, as Philippine climate move towards the dry season.” Mt. Apo Natural Park, the country’s highest peak, suffered forest fires in March 2016 and recently this month in some areas of Matalam, Cotabato.

Nation at a Glance — (03/12/19)

News stories from across the nation. Visit www.bworldonline.com (section: The Nation) to read more national and regional news from the Philippines.
Nation at a Glance — (03/12/19)

Gov’t to revive push vs investment caps

By Melissa Luz T. Lopez
Senior Reporter
THE EXECUTIVE BRANCH will pitch a fresh proposal to the next Congress to lift foreign ownership limits under the 1987 Constitution, the head of the Finance department told reporters last week.
Citing still- “very restrictive” policies on foreign investments, Finance Secretary Carlos G. Dominguez III said: “We are working on getting a proposal to Congress so that we can hold a constitutional convention, not so much to focus on the political side… but actually the more important part, which is the opening up of investments.”
The House of Representatives approved a draft constitution last year, but it was for a shift to a federal form of government. The Senate did not follow suit.
The Finance chief said the department was reviewing the chamber’s proposal, but noted the narrowing window for legislation under the 17th Congress.
The current Congress, now on a Feb. 9-May 19 break for the May 13 mid-term elections, will have the May 20-June 7 session days left to act on any concern. Any bill that fails to bag legislative approval within that period goes back to square one in the 18th Congress that starts in late July.
Mr. Dominguez said the Executive branch has tried to loosen foreign ownership limits administratively, via the new Foreign Investment Negative List signed October last year that opened up Internet businesses, insurance and financing companies and public works to bigger foreign participation.
However, core restrictions remain in the country’s charter — foreigners can hold only up to 40% in companies that operate public utilities; supply materials and goods to state-run firms, government agencies and municipal corporations, to name a few.
“[O]f course we want a regime that will introduce more competition in the Philippines — that was the comment of the World Bank,” Mr. Dominguez explained.
Last week, the multilateral lender said lifting anti-competitive regulations will help boost economic activity, noting that the Philippines is currently more restrictive than its regional competitors.
He clarified, however, that foreign investments account for just around 15% of the total: “Foreign investment is nice, but that’s icing on the cake.”
“That is not what’s going to make this country move forward — it’s the domestic investments.”
Foreign direct investments stood at $9.061 billion as of end-November, 3.2% less than the $9.358 billion investments in 2017’s comparable 11 months. The central bank projects foreigners to invest another $10.2 billion in the Philippines this year, expecting strong appetite as inflation has been easing, while government spending and household consumption have remained robust.

BSP defers full implementation of liquidity rules for bank units

THE BANGKO SENTRAL ng Pilipinas (BSP) has pushed back full implementation of two liquidity measures, covering subsidiaries of big banks, to next year, giving them time to raise more funds for compliance.
In a statement, the central bank said the Monetary Board extended the observation period for the liquidity coverage ratio (LCR) and the net stable funding ratio (NSFR) for subsidiary banks and quasi-banks (QBs) owned by universal and commercial banks until December, with full coverage now eyed in place by Jan. 1, 2020.
“This is to give covered banks/QBs sufficient time to build up their liquidity position given the combined impact of these liquidity measures,” the BSP said over the weekend.
The LCR mandates big banks to hold high-quality, easily convertible assets to cover potential net cash outflows over a 30-day period, while the NSFR requires covered banks to maintain enough “reliable” sources of funding to match their expected needs for a full year.
BSP Deputy Governor Chuchi G. Fonacier said in November last year that monetary authorities were open to postponing the LCR for subsidiary banks that was otherwise scheduled to kick in on Jan. 1.
For now, the subsidiaries will have to maintain LCR and NSFR equivalent to at least 70% of their one-year cash needs before it rises to a minimum of 100% next year.
These standards are in line with the international Basel 3 framework, which is a set of prudential measures meant to ensure a solid footing for banks.
These guarantee that lenders will not fold even during a funding crunch, based on lessons from the 2008 Global Financial Crisis.
“Covered subsidiary banks/QBs that are unable to meet the 100% LCR and NSFR minimum requirement for two consecutive weeks during the observation period are expected to adopt a liquidity build-up plan even if their said ratios meet the 70% floor,” the central bank added.
To help more banks comply, the regulator also approved the inclusion of new bank assets in computing their available liquidity buffers. Now, the cash inflows and outflows from derivative contracts are recognized on a net basis and included in the LCR.
Computations for the 20% minimum liquidity ratio covering thrift, rural and cooperative lenders may now include interbank placements, allowing them to have more resources as eligible liquid assets.
The BSP also found that big banks have more than enough assets to meet the full LCR requirement, with the ratio estimated at 164.44% as of June.
Listed lenders have been tapping the debt markets since last year to rake in additional funds to meet the higher Basel standards this year. — Melissa Luz T. Lopez

Senate leadership open to bill institutionalizing infrastructure drive

By Camille A. Aguinaldo
Reporter
SENATORS are open to a law that institutionalizes the government’s intensified infrastructure development program to ensure continuity of flagship projects after President Rodrigo R. Duterte’s term ends in mid-2022.
“I concur especially if some projects will go beyond the term of the incumbent president,” Senate President Vicente C. Sotto III said in a mobile phone message on Saturday when asked if the measure can be taken up in the 18th Congress which begins in late July, while Senate President Pro-Tempore Ralph G. Recto said in a separate text message: “Yes, it can be legislated but its implementation will still be dependent on our fiscal space.”
In a March 5 Senate hearing on the “Build, Build, Build” program, REID Foundation’s Ronilo M. Balbieran cited the need to institutionalize the government’s infrastructure program to ensure funding continuity for infrastructure projects.
“‘Build, Build, Build’ is working but we need to institutionalize and, if possible, legislate ‘Build, Build, Build.’ In what sense? That this five percent of GDP (gross domestic product) allocation for budget and disbursement [for infrastructure development] must be continued beyond the Duterte administration,” Mr. Balbieran said.
“What happens in the next President’s administration? Are we still going to allocate five percent of GDP in the budget for public infrastructure?”
Philippine Constructors Association (PCA) executive director Barry G. Paulino also said last month that the 10-year infrastructure road map that the construction industry has drawn up included institutionalization of a master development plan for the “Build, Build, Build” program.
Senator Sherwin T. Gatchalian, chairman of the Senate committee on economic affairs, said Mr. Balbieran’s suggestion was a “good proposal,” but noted that the funding aspect of the infrastructure program will need more study.
“It’s a good proposal… so that there’s continuity and we all know… more than half of those projects will go beyond the time of President Duterte. We don’t want the next administration to say, ‘I don’t like this project,’” Mr. Gatchalian said in an interview after a public hearing.
“We’re just studying whether the funding should also be legislated. The projects can be legislated, no problem, but the funding… For example, do you legislate ODA (official development assistance)? For example, in the (Metro Manila) subway, if ODA is the source of funding, what if next year we have GAA (General Appropriations Act) funding for the project so we won’t be needing ODA because it’s cheaper, you don’t pay interest. Maybe if legislate alone, we’re going to be tied then.”
However, Senator Joel J. Villanueva said the proposal may be unnecessary.
“The GAA allocates and guarantees funding for the implementation of our infrastructure projects under the ‘Build, Build, Build’ program. As a legislative act, it is sufficient to ensure that funds are available for these projects,” he said in a text message.
“It is unnecessary to have another law that will institutionalize the ‘Build, Build Build’ program. What is needed is for the Executive to ensure that these projects are implemented and completed within the expected timeline.”
According to a January assessment of the National Economic and Development Authority (NEDA), 47 of the 75 flagship infrastructure projects are expected to be completed beyond 2022, or after Mr. Duterte ends his six-year term.
The Department of Budget and Management reported on March 6 that state infrastructure spending totaled some P886.2 billion in 2018, equivalent to 5.1% of GDP and higher than the target of P868.6 billion for that year.

How does Metro Manila compare to other Megacities?

How does Metro Manila compare to other Megacities?