The Philippine peso was it is likely to be pegged to a high against the dollar this week, analysts say, as the market awaits the release of inflation data both domestically and in the US.
It closed at P56.077 to the dollar on Friday, weakening by 11.2 centavos from its close on Thursday, according to Bankers Association of the Philippines data posted on its website. Week-to-week, the peso likewise fell by 38.7 centavos from its close of P55.69 on September 20.
The peso traded sideways against the dollar on Friday after the US economic growth report came out stronger than in the past, Robert Dan J. Roces, chief economist at Security Bank Corp., in a Viber message.
“Also, risk-on sentiment from China’s stimulus measures could be met with monthly or quarterly buying interest,” he added.
The third quarter report lowered expectations of a rate cut by the US Federal Reserve and led to a weaker dollar, Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., said in a Viber message.
Mr. Roces noted that this week, the peso will likely move according to the report of the US Consumer Price Index (CPI) in August.
Mr. Ricafort said the foreign exchange market will also be watching the Philippine inflation data due on Friday.
Inflation is likely to ease to 2.5% in September, according to an average of 15 analysts BusinessWorld voting, up from 3.3% in August and 6.1% last year. This would be the slowest of about four years.
Mr. Ricafort expects the peso to trade from P55.75 to P56.25 per dollar this week. – Aaron Michael C. Sy
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