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Peso weakens ahead of US GDP

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peso dollar 032018 - Peso weakens ahead of US GDP

THE PESO weakened further on Wednesday as the dollar strengthened across Asian currencies ahead of the first-quarter US economic data release.

The local unit closed Wednesday’s session at P52.23 versus the greenback, 19 centavos weaker from the P52.04-per-dollar finish recorded last Monday.

The peso traded weaker the whole day, opening the session at P52.14 per dollar. It reached a low of P52.325, while its intraday high was at P52.10.

Trading volume climbed to $1,373.48 billion from $976.9 million that changed hands the previous session.

Peso trading was suspended on Tuesday following the magnitude 6.1 earthquake that shook several parts of Luzon, prompting the Bangko Sentral ng Pilipinas to close treasury operations.

A foreign exchange trader said in a phone interview that the peso weakened yesterday, mimicking the downward move of its peers versus the dollar.

“We saw a strong dollar across the region. This is ahead the US GDP (gross domestic product) data on Friday. I guess people are expecting a strong print,” the trader said.

The trader added that resistance levels were broken yesterday, continuing the weakening move of the peso last Monday.

“There was a lot of pent-up demand in the morning, we saw a lot of corporate demand in the morning as well, pushing it higher,” the trader added.

Meanwhile, another trader attributed the depreciation of the peso to upbeat US corporate earnings which drove dollar demand.

“The said reports also reinforced views of lingering strength in the US economy despite worries of an ‘earnings recession’ from the recent weakening in global demand,” the trader said in an e-mail.

For today, the first trader expects the peso to move between P52.15 and P52.35, while the other trader gave a P52.10-P52.40 range. — K.A.N. Vidal

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