The PESO could appreciate against the dollar this week, supported by the seasonal increase in remittances during the holiday season and dovish signals from the US Federal Reserve.
The local unit closed at P56.10 per dollar on Friday, strengthening by 63 centavos from its P56.73. Fiend Tuesday, based on data from the Bankers Association of the Philippines.
This was the peso’s best close in almost three months or since its closing price of P56.02 per dollar on August 7.
Week over week, it gained 85.5 centavos from its close of P56,955 on October 27.
The peso opened Friday’s session at P56.60 against the dollar, also its weakest reading. Its intraday best was P55.93 against the greenback.
Dollars traded reached $1.84 billion on Friday, up from $860.9 million on Tuesday.
The peso appreciated against the dollar on Friday amid a seasonal increase in remittances due to last week’s holidays and after the US central bank signaled that its tightening cycle may be coming to an end, a Rizal Commercial Banking Corp. chief economist said. Michael L. Ricafort in a message on Viber. message.
The Federal Reserve held interest rates steady Wednesday as policymakers struggled to determine whether FiFinancial conditions may already be tight enough to control inflation, or an economy that continues to outperform expectations may need more restraint, Reuters reported.
Fed Chairman Jerome Powell said the situation remained a conundrum, with the US central bank offileaders are ready to raise rates again if they make progressflThe economic situation comes to a halt amid fears that a rise in market-based interest rates will begin to weigh on the economy significantly.FiWe are not succeeding and we are trying not to disrupt, any more than necessary, a continuous dynamic of regular growth in employment and wages.
At a news conference after a two-day policy meeting, Powell said the best solution for now, given the uncertainties, was to maintain the benchmark interest rate of the Fed day by day in the current range of 5.25% to 5.5%, and see how employment and price data evolve between now and the next policy meeting in December.
This week, the peso could continue to Fiand support from the expected seasonal increase in remittances and dovish rhetoric from the Fed, Mr. Ricafort said.
“The peso will likely benefit from support from withinfl“The financial flows and favorable sentiment are due to the likely Fed pivot, which was behind (Friday’s) close,” Security Bank Corp. Chief Economist Robert Dan J also said. Roces, in a Viber message on Friday.
The market could also benefit from advances from the October publicationflation data on Tuesday, added Mr. Ricafort.
A Business world A poll of 13 analysts last week gave a median estimate of 5.7% for October inflation, under the Bangko Sentral ng Pilipinas (BSP) forecast of 5.1 to 5.9 percent.
If this comes true, in OctoberflGrowth would be lower than 6.1% in September and 7.7% in the same month last year. It would also be the lowest rate in two months, since 5.3% in August.
However, October would mark the 19th consecutive month in whichflInflation was above the central bank’s target of 2-4%.
For this week, Mr. Ricafort sees the peso oscillating between P55.85 and P56.35 per dollar, while Mr. Roces expects it to move between P56 and P56.40. — AMC system with Reuters