THE PESO ended flat on Wednesday as traders stayed on the sidelines ahead of the central bank’s policy meeting later in the day.
The local currency closed at P47.815 versus the dollar on Wednesday, barely changed from Tuesday’s P47.81 finish, data from the Bankers Association of the Philippines’ website showed.
The peso opened at P47.80 against the dollar. It dropped to as low as P47.87, while its intraday best was logged at P47.785 versus the greenback.
Dollars traded went up to $869.05 million on Wednesday from $837 million the day before.
“The peso was nearly unchanged due to some caution ahead of the BSP (Bangko Sentral ng Pilipinas) policy meeting today,” a trader said via e-mail on Wednesday.
The BSP announced after the market closed that its Monetary Board kept benchmark rates unchanged at their current record lows to support the economy’s recovery.
Meanwhile, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the peso moved sideways following the release of first-quarter gross domestic product (GDP) data.
The country’s GDP shrank by a worse-than-expected 4.2% in the first quarter, the Philippine Statistics Authority (PSA) reported on Tuesday. This was higher than the median estimate of a 2.6% decline in a BusinessWorld poll last week.
The trader said the peso could weaken further on Friday amid expectations of strong US consumer and producer inflation reports.
Mr. Ricafort said the peso will likely trade between P47.76 and P47.86 per dollar on Thursday, while the trader gave a forecast range of P47.75 to P47.95 versus the greenback.
Financial markets are closed on Thursday in observance of Eid’l Fitr (Feast of Ramadan). — B.M. Laforga