THE PESO may climb further versus the dollar this week as the market expects a further decline in cases of the coronavirus disease 2019 and after the Democratic Party’s Joseph R. Biden, Jr. was projected to be the new 46th president of the United States.
The local unit closed at P48.22 versus the dollar on Friday, increasing by nine centavos from its P48.31 finish on Thursday, data from the Bankers Association of the Philippines showed.
Week on week, the peso strengthened by 18 centavos from its P48.40-per-dollar finish on Oct. 30.
Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the peso strengthened after the partial results of the US presidential election showed Mr. Biden ahead of former president Donald J. Trump.
A trader said in an e-mail that the development in the US election weakened safe-haven sentiment for the dollar.
US President-elect Mr. Biden declared it was “time to heal” a deeply divided America in his first speech after winning in a bitter election, even as Mr. Trump refused to concede and pressed ahead with legal fights against the outcome, Reuters reported.
Mr. Biden’s victory on Saturday in Pennsylvania put him over the threshold of 270 Electoral College votes he needed to clinch the presidency, ending four days of nail-biting suspense and sending his supporters into the streets of major cities in celebration.
Mr. Trump, who was golfing when the major television networks projected his rival had won, immediately accused Mr. Biden of “rushing to falsely pose as the winner.”
Mr. Trump has filed a raft of lawsuits to challenge the results, but election officials in states across the country say there has been no evidence of significant fraud, and legal experts say Mr. Trump’s efforts are unlikely to succeed.
For this week, Mr. Ricafort and the trader expect Mr. Biden’s victory to heighten demand for the peso following increased buying in the local and US stock markets amid high hopes for better economic prospects.
The trader added the local downtrend in daily COVID-19 cases in the Philippines, which have fallen to just near 2,000 from 3,000 in September, will further support the peso.
New cases on Saturday hit 2,167 while recovered patients were 350,216 or 90% of total cases, the Health department said.
Mr. Ricafort said other major catalysts include third-quarter gross domestic product and bank loans data set for release on Tuesday.
For this week, Mr. Ricafort sees the peso moving from P48.05 to P48.35 versus the dollar, while the trader expects it to range from P48.15 to P48.35. — K.K.T. Jose with Reuters