Peso hits P50.88:$1
Credit to Author: Mayvelin U. Caraballo, TMT| Date: Wed, 30 Oct 2019 18:21:49 +0000
THE Philippine peso returned to P50:$1 on Wednesday amid the anticipated cut in the US interest rates and better Philippine economic growth in the third quarter.
The peso, which opened at P51.07 against the greenback, gained 21 centavos to close at P50.88 from P51.09 the previous day.
“The peso moved sideways with a slight appreciation bias as foreign flows continued to help prop the peso with market players pricing in a cut by the Federal Reserve,” ING Bank Manila senior economist Nicholas Antonio Mapa said in a comment.
This, as well as the signals made by the Bangko Sentral ng Pilipinas (BSP) that it would keep policy rates steady for the year, supported foreign flows to return “to help steady peso as differentials are set to widen,” Mapa explained.
“Expectations for better than expected GDP (gross domestic product) numbers in the coming week also pushed demand for equities with foreign investors helping the PSE (Philippine Stock Exchange) index close above 8,000 for the session,” he added.
Official third quarter GDP data is scheduled to be released by the Philippine Statistics Authority on November 7.
Earlier, BSP Deputy Governor Francisco Dakila Jr. said central bank models suggest Philippine economic growth in the last two quarters of the year would be much better than in the first two.
The third quarter growth is forecasted to settle between the 5.8- to 6-percent range, while Dakila added a 6.5-percent GDP growth “can be reachable” by the fourth quarter.
These forecasts compare with the slower-than-expected 5.6-percent and 5.5-percent GDP expansions in the first and second quarters that resulted in a 5.5-percent expansion in the first half of 2019, well below the government’s downwardly revised target range of 6 to 7 percent.