THE PESO was nearly flat on Wednesday amid tensions in the Middle East. — BW FILE PHOTO

THE PESO moved sideways on Wednesday as it was supported by the influx of remittances amid risk-off sentiment arising from escalating geopolitical tensions in the Middle East.

The local unit closed at P50.756 per dollar on Wednesday, almost flat from its P50.76 finish on Tuesday, according to data from the website of the Bankers’ Association of the Philippines.

The peso opened at P51.16 against the greenback. Its weakest showing was at P51.25, while its strongest was at P50.74 versus the dollar.

Dollars traded rose to $1.963 billion from $1.627 billion on Tuesday.

UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion said he initially expected a depreciation for the local unit given the retaliatory act by Iran.

Reuters reported that Iran launched 15 missiles at US-led forces in Iraq following the death of their top military official due to a Washington-sponsored drone strike, which ignited worries that a war might break out in the Middle East.

Iran’s Supreme Leader Ali Khamenei said the missile attack was a “slap on the face” of the United States and that US troops should leave the region. He was addressing a gathering of Iranians who chanted “Death to America.”

“But it seems that the peso this week has shown some resilience and it may be coming from remittance inflows and other dollar receipts,” Mr. Asuncion said in a text message.

Historically, remittance inflows peak during the Christmas holiday season as well as enrolment season.

Latest Bangko Sentral ng Pilipinas data showed cash remittances in October picked up by 8% to $2.671 billion from $2.474 billion in the same month last year.

“The peso gradually appreciated towards the close amid easing tensions between the US and Iran after the latter said that it does not intend to go into war after making retaliatory attacks on US military bases in Iraq,” a trader said in an e-mail.

For today, Mr. Asuncion gave a forecast range of P50.60-50.90, while the trader sees the local unit playing around P50.60-50.80 against the dollar. — L.W.T. Noble with Reuters