Peso drops further in quiet trade
THE PESO slid against the dollar on Thursday in quiet trading due to lack of major global and domestic drivers, but with some investors likely accomplishing month-end requirements and pricing in bets of upbeat US economic growth.
The local unit finished at P50.20 versus the greenback yesterday, 1.5 centavos weaker from its P50.185 per dollar close during previous session.
The peso opened the session at its closing rate of P50.20 versus the foreign currency, while its intraday trough was at P50.21 per dollar.
Its peak was seen at P50.17 against the greenback.
Dollars traded on Thursday dropped to $320.5 million from the $441.4 million that changed hands the previous session.
“The peso depreciated slightly today likely because of three factors: month-end dollar demand, safe-haven buying amid renewed Brexit concerns, and bets of an upward revision in US fourthquarter GDP ( gross domestic product) growth,” one trader said on Thursday.
British Prime Minister Theresa May had officially signed United Kingdom’s exit from the European Union on Wednesday, affirming that they will not be withdrawing their stance, bringing the country to uncertainties.
Meanwhile, US GDP growth data for the October to December period was scheduled for release overnight.
“The peso’s depreciation was capped by persistent political concerns in the US.”
For Friday, one trader said peso may play between P50.10 and P50.30 against the dollar while the other sees the pair trading within P50.10 to P50.40 range.
“The peso might weaken further due to expectations of an upward revision in US growth. The manufacturing and non-manufacturing data from China might also affect trading, especially if they fail to satisfy expectations of a steady reading,” one trader noted.
Most Asian currencies also edged lower versus the dollar on Thursday, as weakness in the euro helped bolster the greenback, with China’s yuan touching its lowest level in nearly a week.
The Chinese yuan slipped to 6.8956 per US dollar at one point, its lowest level since last Friday. It later pared its losses and was little changed on the day.