THE PESO strengthened against the dollar on Thursday amid the seasonal increase of remittances ahead of the long weekend and expectations of softer US personal consumption expenditures (PCE) price index data.
The local unit closed at P58.10 per dollar on Thursday, rising by 13 centavos from its P58.23 finish on Wednesday, Bankers Association of the Philippines data showed.
The peso opened Thursday’s session slightly stronger at P58.20 against the dollar. Its intraday best was its closing level of P58.10, while its worst showing was at P58.275 versus the greenback.
Dollars exchanged went up to $1.3 billion on Thursday from $1.24 billion on Wednesday.
The local currency was supported by the seasonal increase of remittances ahead of the long All Saints’ and Souls’ Day weekend, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.
“The peso appreciated due to anticipated month-end flows and expectations of softer US PCE inflation report tonight,†a trader said in an e-mail on Thursday.
The yen traded in a narrow range on Thursday after the Bank of Japan (BoJ) left ultra-low interest rates unchanged, while the US dollar consolidated ahead of jobs data later this week and the US presidential election next week, Reuters reported.
The Japanese currency has taken a beating, down around 6% for the month as the dollar and US Treasury yields have hovered around their highest since July.
Japan’s political shake-up has only added to the yen’s woes, heightening uncertainty about the country’s fiscal and monetary policy outlook.
The BoJ stood pat on Thursday, as expected, and signaled the need to scrutinize global economic developments, highlighting its focus on risks to a fragile domestic recovery in deciding when to next tighten policy.
The yen fluctuated before gaining after the BoJ’s decision. It was last up 0.38% at 152.83, keeping close to 153 per dollar.
Analysts are divided over the prospect of additional interest rate hikes by yearend, putting the focus on BoJ Governor Kazuo Ueda’s post-meeting briefing for clues on the pace and timing of further increases.
The dollar held steady ahead of the US PCE price index for September on Thursday and the closely watched nonfarm payrolls report on Friday. Economists polled by Reuters estimate 113,000 jobs were added in October, although the number could be lower due to recent hurricanes.
But the jobs report may find itself overshadowed in the run-up to the presidential election on Tuesday.
Some investors have been putting on trades betting Republican candidate Donald Trump will win, helping to lift the greenback and US Treasury yields, although he is still neck and neck with Vice-President Kamala Harris in several polls.
The dollar index, which measures the currency against six major rivals, was flat at 104.1. It is set for its biggest monthly gains against peers since April 2022.
The euro edged down 0.03% to $1.0852 after rising as high as $1.0871 on Wednesday.
Sterling stood at $1.2956, down 0.04% so far on the day.
Elsewhere, the Australian dollar slid 0.05% to $0.65749 after domestic retail sales numbers for September missed estimates, inching up just 0.1%. Analysts had looked for a gain of 0.3% in September. — AMCS with Reuters
