THE PESO recovered against the dollar yesterday following the upbeat statement of US President Donald J. Trump on its trade negotiations with China that slightly boosted the risk appetite of investors.
The local unit ended Wednesday’s session at P52.35 against the greenback, 8.5 centavos stronger than the P52.435-per-dollar finish last Tuesday.
The peso opened the session at its intraday low of P52.43 against the dollar. Meanwhile, its best showing stood at P52.28 versus the greenback. Trading volume thinned slightly to $847.3 million from $881.1 million that changed hands the previous session.
A foreign exchange trader said the peso traded within range yesterday.
“Not much movers to be considered, but we saw peso stronger against the dollar on slight risk-on sentiment given that Trump said the deal has not collapsed with China,” the trader said in a phone interview.
On Tuesday, Mr. Trump said the trade negotiations between the US and China did not collapse, saying the two countries are merely having a “little squabble.”
“We’re having a little squabble with China because we’ve been treated very unfairly for many, many decades,” he told White House reporters.
Last week, Washington raised levies on $200 billion worth of Chinese goods to 25% from 10%. In retaliation, Beijing said it will increase tariffs on $60 billion worth of US goods by June 1.
Despite these actions, Mr. Trump still touted his relationship with his Chinese counterpart Xi Jinping as “extraordinary.”
Most other Asian currencies also enjoyed a welcome breather after Mr. Trump softened his tough trade rhetoric against China.
“The peso appreciated as market sentiment improved as President Trump noted that the trade discussions between the US and China will continue despite the recent mutual imposition of higher tariffs,” another trader said.
The first trader added that markets are anticipating the possible cut in banks’ reserve requirement ratio today at the Bangko Sentral ng Pilipinas’ Monetary Board’s weekly meeting.
For today, the first trader expects the local unit to move between P52.30 and P52.60, while the other trader gave a P52.20-P52.50 range. — Karl Angelo N. Vidal