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Peso strengthens on return of risk-on sentiment

peso strengthens on return of risk on sentiment - Peso strengthens on return of risk-on sentiment

The peso rallied Friday on improved investor risk appetite following a decline in US jobless data.

The peso closed at P48.765 against the dollar Friday after its Thursday finish of P48.84 finish on Thursday, according to data from the Bankers Association of the Philippines.

Week-on-week, the peso rallied from its P49.041 close on Aug. 7.

The peso started trading at P48.83. The low was P48.85 while the high was P48.75.

Dollar volume fell to $599.65 million from P632.1 million Thursday.

Risk appetite improved after recent gains in US markets, though Wall Street closed mixed Thursday following a reduction in jobless claims, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said.

“The peso closed stronger amid continued weakness in the dollar after improved global market risk appetite that sent most US stock markets to 5.5 month highs,” he said in a text message.

Meanwhile, a trader said dollar demand waned in anticipation of a weak performance by the US retail industry.

“The peso appreciated due to expectations of weaker US retail sales for July 2020 amid the re-imposition of lockdown measures in several US states,” he said in an e-mail.

In June, US retail sales rose 7.5% after consumption was propped up by US unemployment benefits, according to Reuters. The July data will be released Friday. — Luz Wendy T. Noble

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