February 4, 2023

Filipino Guardian

Sentinels of Filipino Free Press

Peso sideways on holiday spending

FAMILIES browse the various stalls selling food and affordable gift items in Imus town square, Cavite, on Friday night. — FILIPINO STAR/ MIGUEL DE GUZMAN

The PESO is expected to move sideways this week on further holiday spending surge, especially as trading approaches the end of the season.

The local unit closed at P55.15 per dollar on Friday, weakening six centavos from its close of P55.09 on Thursday, data from the Bankers Association of the Philippines showed.

Week-on-week, however, the peso is up 41 centavos from its close of P55.56 on December 16th.

The peso opened Friday’s session weaker at P55.25 per dollar. It fell as low as P55.35 while its intraday high was P55.15 against the greenback.

Dollars exchanged rose to $1.02 billion on Friday from $774.2 million recorded on Thursday.

A trader said in a Viber message that the peso on Friday weakened against Thursday’s strong dollar close following a positive revision of US gross domestic product (GDP) data.

“Initially, [dollar-peso rate] was even higher to reflect [Thursday’s] broad dollar strength on US GDP data,” the trader said.

The US government revised its July-September GDP estimate to 3.2% on Thursday, from a previous estimate of 2.9%, according to a report by Bloomberg. This came after an upward revision in consumer spending and business investment.

For this week, Rizal Commercial Banking Corp. chief economist Michael L. Ricafort said in a Viber message that the peso would still be affected by increased holiday spending, leading to increased conversion of remittances into pesos.

“The Christmas holiday long weekend may still result in accelerated holiday-related spending, which could also result in some seasonal increase in remittances-to-pesos conversions…in preparation for the New Year’s holiday long weekend,” Mr. Ricafort said.

Mr. Ricafort expects the peso to range between P54.90 and P55.40 this week, while the trader is slightly higher at P55 to P55.50 per dollar. — Aaron Michael C.Sy