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Peso climbs on record-high GIR

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THE PESO strengthened against the dollar on the back of positive local data and in line with the performance of regional currencies.

The local unit ended at P51.77 against the greenback on Tuesday, climbing nine centavos from its P51.86-to-a-dollar close on Monday.

The peso opened at P51.87 versus the dollar. Its weakest point was recorded at P51.90, while its intraday best was at P51.69 against the greenback.

Dollars traded on Tuesday climbed to $1.131 billion against the $828.6 million seen on Monday.

UnionBank of the Philippines, Inc. chief economist Ruben Carlo O. Asuncion attributed the peso’s strength to both international and local factors.

“It may have been due to the general jump in markets across Asia. The positive GIR (gross international reserves) numbers may have driven the uptick as well,” Mr. Asuncion said in a text message.




“The peso was stronger today…a day after the announcement of the GIR, thereby fundamentally providing a greater buffer for the peso exchange rate,” Rizal Commercial Banking Corp. (RCBC) chief economist Michael L. Ricafort said in a text message on Tuesday.

Most Asian currencies edged higher on Tuesday with the Chinese yuan firming the most after reopening from a week long holiday while investors held positions ahead of the high level Sino-US trade talks on Thursday and Friday.

Prospects for progress in US-China trade talks dimmed on Monday after Washington blacklisted Chinese companies but comments by US President Donald Trump and his top economic adviser, Larry Kudlow on looming trade talks were generally upbeat.

“We think there’s a chance we could do something very substantial,” Mr. Trump said about the talks.

This comes after a media report stated that China is looking to narrow the scope of the talks.

Meanwhile, the Bangko Sentral ng Pilipinas reported on Monday that the country’s gross international reserves hit a record high of $86.163 billion as of September.

For today, UnionBank’s Mr. Asuncion said the peso could range from P51.50-51.80 versus the dollar, while RCBC’s Mr. Ricafort said it may end within P51.60-51.90. — LWTN with Reuters

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