THE peso remained under pressure on Monday, touching a new intraday low of P62.775 to the dollar before regaining ground to end the day at P62.586, just shy of Friday’s record close of P62.59 to the greenback.
The currency opened at P62.62:$1 and ranged from P62.58 to P62.775. Volume increased to $1.189 billion from $1.521 billion in the previous session.
Philippine Institute for Development Studies senior fellow John Paolo Rivera said the peso remained weak mainly due to external factors, particularly “higher oil prices amid renewed Middle East tensions, elevated global yields, and expectations of tighter US monetary policy.”
“For an oil-importing economy like the Philippines, higher crude prices also increase demand for dollars and add to inflation concerns,” he said.
“I expect the peso to remain volatile and potentially test further lows in the near term if these pressures persist.”
A trader said that P63:$1 was now “within striking distance, but I would not view it as inevitable.”
“At these levels, the market will increasingly test the BSP’s (Bangko Sentral ng Pilipinas) tolerance for volatility, and the recent rate hike gives it more room to lean against disorderly moves,” the trader added.
“The key question is no longer whether P63 can be touched, but whether the peso can stay there.”
The currency’s continued weakness weighed on Philippine shares, with the benchmark Philippine Stock Exchange index (PSEi) shedding 6.92 points, or 0.11 percent, to 6,083.68.
Japhet Tantiangco, research manager at Philstocks Financial Inc., said the peso’s weakness was among the factors that pulled the PSEi lower.
Trading remained tepid, with net value turnover reaching P3.33 billion. Foreign investors were net sellers, recording net outflows of P311.06 million.
Luis Limlingan, head of sales at Regina Capital Development Corp., said investors remained cautious as the peso continued to depreciate.
“Moreover, ongoing tensions surrounding Iran and US and elevated oil prices continued to weigh on market sentiment,” he said.
“Overall, investors remained on the sidelines amid heightened geopolitical, currency, and commodity-related risks.
Industrial stocks led the gainers, rising 0.97 percent, while the property index declined 0.38 percent.
Market breadth was negative, with 92 gainers against 98 decliners, while 70 issues were unchanged.
