Peso weakens further

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THE PESO weakened further against the dollar on Wednesday as market participants await economic data to be released later this week.

The local currency closed Wednesday’s session at P51.16 versus the greenback, five centavos weaker than its P51.11-per-dollar finish on Tuesday.

The peso opened the session at P51.20 per dollar. It dropped to as low as P51.25, while its best showing stood at P51.12 against the greenback.

Trading volume declined slightly to $924.2 million from the $931.4 million that changed hands the previous day.

“We closed slightly weaker, but for the dollar-peso, it’s still choppy since the market is still awaiting key data later in the week,” a trader said in a phone interview.

US non-farm payrolls data, which will be released by the US Bureau of Labor Statistics on Friday, is expected to have climbed to 160,000 in June, coming from a meager 75,000 jobs in May.

On the local front, inflation data for the month of June will be reported by the Philippine Statistics Authority on Friday. A BusinessWorld poll of 12 economists yielded a 2.9% estimate median, which if realized would be slower than May’s 3.2% print.

The Bangko Sentral ng Pilipinas Department of Economic Research said June headline inflation likely landed within 2.2-3%.

“On some currencies, we saw a weaker dollar, but against Asian currencies, the dollar was stronger mainly on risk-off move. However, the low dollar bond yield capped any gains for the dollar-peso,” the trader said.

Meanwhile, another trader said the peso depreciated on “wavering trade optimism” following news of the US planning to impose tariffs on European goods.

The US proposed to slap on the European Union levies worth $4 billion covering 89 products such as cheese, meat, coffee, pasta and whiskey.

For today, the first trader expects the peso to trade between P51 and P51.30, while the other gave a P51.10-P51.40 range.

Most emerging Asian currencies on Wednesday were also shackled by underlying doubts about whether the United States and China could iron out their differences and strike a lasting deal to end their year-long trade war. — K.A.N. Vidal with Reuters