Business News

Peso extends losing streak, hits fresh 19-month low at 58.71:$1

MANILA – The Philippine peso depreciated against the US dollar for the second straight trading day on Tuesday, June 4, to carve a fresh 19-month low, ahead of the release of local economic data later this week.

The local currency shed 3 centavos to close at P58.71:$1 from Monday’s finish of P58.68:$1. This is the weakest performance of the peso since November 3, 2022’s finish of P58.80:$1, GMA News reported.

“The US dollar/peso exchange rate went up for the second straight trading day… ahead of the latest inflation data on Wednesday that is expected to slightly pick up after 3.8% in April 2024, as a source of new leads for the local financial markets,” Rizal Commercial Banking Corp. (RCBC) chief economist Michael Ricafort said.

The Bangko Sentral ng Pilipinas (BSP) projects could have reached as high as 4.5% in May, faster than the government’s target range of 2.0% to 4.0%. Should this be realized, this would mark the highest in seven months since October 2023’s 4.9%.

Other economic data scheduled for release later this week are the April labor force survey and June trade data on Thursday, June 6, and the April manufacturing figures on Friday, June 7.

According to BSP governor Eli Remolona Jr., the central bank intervenes in the foreign exchange market when it is “under stress” or when it finds some “dysfunction in the market.”

“When do we intervene? We don’t intervene every day. We intervene when we have to and when we say we have to, it’s when the currency is under stress,” he said.

“Under stress means we find some dysfunction in the market — there’s maybe, when liquidity disappears and then we intervene to provide more liquidity,” he added.

BSP senior assistant governor Iluminada Sicat last week said the recent weakness of the peso is only temporary, as the greenback is buoyed by developments overseas.

LEAVE A RESPONSE

Your email address will not be published. Required fields are marked *