Peso down ahead of US retail sales data

THE PESO weakened ahead of the release of US retail sales data. — BW FILE PHOTO

THE PESO depreciated versus the greenback for the second straight day on Tuesday amid preference for the dollar on expectations of strong US retail sales data.

The local unit closed at P50.30 per dollar on Tuesday, shedding 11 centavos from its P50.19 finish on Monday, data from the Bankers Association of the Philippines showed.

The peso opened Tuesday’s session stronger at P50.15 per dollar, which was also its intraday best. Meanwhile, its weakest showing during the session was at P50.35 versus the greenback.

Dollars traded picked up to $1.391 billion on Tuesday from $1.156 billion on Monday.

The peso depreciated versus the greenback ahead of US retail sales report, which is expected to be upbeat, a trader said in an e-mail.

The US Commerce department will report the October retail sales data overnight. In September, US retail sales increased by 0.7%, with the biggest gains recorded for sporting goods and hobbies, and general merchandise.

The market also factored in the impact of the wider implementation of the alert level system in the country, with most areas now under more relaxed restrictions, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said.

“This further support economic recovery prospects that could entail some increase in importation activities,” he said in a Viber message.

For Wednesday, Mr. Ricafort gave a forecast range of P50.15 to P50.35, while the trader expects the local unit to move within P50.20 to P50.45 against the dollar. — L.W.T. Noble