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Peso likely to rise on fewer virus cases

peso likely to rise on fewer virus cases - Peso likely to rise on fewer virus cases

THE PESO may continue climbing versus the dollar this week as the economy further reopens due to expectations of fewer cases of the coronavirus disease 2019 (COVID-19) in the country and strong liquidity.

The local unit closed at P48.48 versus the dollar on Friday, rising by 12 centavos from its P48.60 finish on Thursday, data from the Bankers Association of the Philippines showed.

Week on week, the peso appreciated by 14.5 centavos from its P48.625-per-dollar finish on Oct. 16.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the peso rose after the continued decline in COVID-19 cases.

Meanwhile, a trader said the peso was stronger as the United States government was expected to advance talks on a stimulus to combat the impact of COVID-19.

Mr. Ricafort said over the weekend that the peso may continue to strengthen versus the dollar this week as the decreasing trend in coronavirus cases could convince the government to further relax quarantine measures in Metro Manila and nearby areas.

“Major catalysts include any additional measures to further reopen the economy, such as possible relaxation of Metro Manila’s general community quarantine to a modified version as early as November or December,” Mr. Ricafort said in an e-mail.

The government earlier this month allowed persons aged 18 to 65 to leave their homes for non-essential travel. It also shortened curfew hours in Metro Manila cities.

A trader said the local currency will likely rise further as the easing of restrictions could boost business activity.

Mr. Ricafort said other catalysts for the peso this week will include data on domestic loans and the country’s balance of payments.

For this week, Mr. Ricafort sees the peso moving from P48.35 to P48.60 versus the dollar, while the trader expects it to range from P48.40 to P48.60. — KKTJ

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