THE PESO strengthened versus the greenback on Tuesday amid upbeat sentiment on the Philippine economy following better-than-expected growth in the third quarter.
The local unit ended trading at P50.091 per dollar on Tuesday, gaining 6.9 centavos from its P50.16 close on Monday, based on data from the Bankers Association of the Philippines.
This is the currency’s strongest close since it ended trading at P49.95 on Sept. 17, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.
The peso opened Tuesday’s session at P50.12 per dollar, stronger than its previous day’s close. Its weakest showing was at P50.18, while its intraday best was at P49.925 versus the greenback.
Dollars exchanged increased to $1.385 billion on Tuesday from $933.2 million.
A trader said the stronger- than-expected economic growth posted in the previous quarter supported the peso.
“The latest reading also set the year-to-date growth at 4.9%, firming expectations that full-year 2021 economic growth will likely fall within the government’s 4% to 5% forecast range,” the trader said in an e-mail.
Gross domestic product expanded by 7.1% year on year in the third quarter, slower than the 12% growth in the April to June period, the Philippine Statistics Authority reported on Tuesday. Still, it was stronger than the 4.7% median estimate in a BusinessWorld poll of 18 analysts held last week.
Meanwhile, Mr. Ricafort said local stock market gains also fueled positive market sentiment.
The Philippine Stock Exchange index gained 45.45 points or by 0.61% to end trading at 7,441.67 on Tuesday.
The wider all shares index likewise gained by 20.97 or 0.46% to close at 4,531.86.
For Wednesday, the trader gave a forecast range of P50 to P50.25, while Mr. Ricafort expects the local unit to move within P49.97 to P50.17 per dollar. — L.W.T. Noble