Peso inches up vs dollar

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THE PESO strengthened a tad against the dollar on Wednesday amid large trading volume ahead of the meeting between the US and Chinese leaders.

The local unit closed yesterday’s session at P52.585 versus the greenback, just two centavos stronger than the P52.605 finish the previous day.

The peso opened the session weaker at P52.67, while its intraday high stood at P52.51. Its worst showing, on the other hand, was at P52.72 against the US currency.

Trading volume slid to $1.053 billion from the $1.067 billion that switched hands on Tuesday.

A foreign exchange trader said the peso strengthened slightly even as the dollar moved higher ahead of the meeting between Chinese President Xi Jinping and US President Donald Trump.

“The peso traded in a high range between P52.50-P52.70. So it’s more of a reflection of the dollar trading higher,” the trader said in a phone interview.

Reuters reported that the dollar’s strength also reflected risks around the upcoming G20 Summit in Buenos Aires wherein the leaders of the two biggest economies are scheduled to discuss trade issues.

In an interview with the Wall Street Journal, Mr. Trump said it was “highly unlikely” Washington would accept Beijing’s proposal to postpone the 25% tariffs to be imposed on Chinese goods by next year.

“The peso slightly appreciated amid risk-on sentiment ahead of Trump’s upcoming trade talks with China,” another trader said.

For today, the first trader expects the peso to trade between P52.45 and P52.65, while the other gave a P52.50-P52.70 range.

“We will continue to trade between P52.50 and P52.75, range. We have to hear from other Fed officials on what they think about the path next year,” a third trader said.

On Tuesday, Federal Reserve Vice Chair Richard Clarida backed the central bank’s approach to hiking interest rates, saying it is “necessary.” Investors are now awaiting clues from Fed Chair Jerome Powell on the future path of policy rates. — K.A.N. Vidal