THE peso strengthened on Monday on positive market sentiment as there were fewer new cases of coronavirus disease 2019 (COVID-19) in some countries and as investors await further aid for businesses amid the pandemic.
The local unit ended trading at P50.695 per dollar on Monday, strengthening by 14.50 centavos from its previous close of P50.84 on Friday, according to data from the Bankers Association of the Philippines.
The peso opened the session at P50.75 per dollar. Its weakest showing was at P50.77 while its intraday best was at its close of P50.695 against the greenback.
Dollars traded went down to $213.82 million on Monday from the $391.68 million seen on Friday.
The stronger peso came on the back of positive sentiment due to lower COVID-19 cases in some global hotspots, according to Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp.
“The peso exchange rate closed stronger amid some improvement in global market risk appetite after new coronavirus cases and deaths already slowed down in some hard-hit countries, especially those in Europe,” he said in a text message.
Meanwhile, a trader said investors are awaiting additional stimulus to support the US economy during this pandemic.
“The peso strengthened from prospects over the eventual approval of the $484-billion stimulus package for small businesses and the medical sector,” the trader said in a text message.
The stimulus was passed by the US House of Representatives on Thursday and will expand federal loans to small businesses hit hard by COVID-19. Part of this will also go to hospitals that have been overwhelmed with patients sickened by the virus.
The said bill is now awaiting the signature of US President Donald J. Trump.
For today, Mr. Ricafort gave a forecast range of P50.60 to P50.80 while the trader expects the peso to move around the P50.60 to P50.80 band. — L.W.T. Noble with Reuters