Peso drops after Wall Street rally

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THE peso declined on Friday as the dollar recovered following the Wall Street rally amid the release of upbeat corporate earnings.

The local currency ended the week at P52.21 versus the greenback, down nine centavos from the P52.12-per-dollar finish last Thursday.

The peso opened the session slightly weaker at P52.13 per dollar, trading to as high as P52.10 intraday. Meanwhile, its worst showing for the day was at P52.31 versus the US currency.

Trading volume thinned to $869.3 million from the $1.014 billion that switched hands the previous day.

A foreign exchange trader said the peso continued to follow the dollar’s general movement as it strengthened overnight.

“The dollar recovered overnight mainly on the positive equities in their market,” the trader said.

Reuters reported that Wall Street extended its rally on Thursday as strong earnings report from Facebook added optimism to the market.

This was after the US Federal Reserve kept its borrowing costs steady, indicating that it will not increase its benchmark rates anytime soon.

“So far, we’re seeing the dollar still below the resistance level. The dollar could still move lower in the next few days,” the trader said.

Another trader said in an e-mail that the peso declined on investor bargain-hunting following the recent strength of the currency. — Karl Angelo N. Vidal