Peso rebounds on stronger remittances in July
THE PESO recovered slightly against the dollar on Tuesday on the back of stronger-than-expected remittances data and amid corporate demand.
The local currency ended Tuesday’s session at P54.07 versus the greenback, four centavos stronger than the P54.11 finish last Monday.
The peso opened the session weaker at P54.15 versus the dollar. It climbed to as high as P54.06, while its worst showing for the day stood at P54.17 per US currency.
Dollars traded declined to $766.45 million from the $807.2 million that switched hands the previous day.
A foreign exchange trader said the peso-dollar pair continued its volatile trading yesterday.
“It was quite volatile due to corporate demand. On the opposite side, we saw some reversal in the offshore market wherein they’re quite on the selling side,” the trader said in a phone interview.
The trader added that the July remittances data released last Monday “was also a driver for the strengthening of the peso.”
Money sent home by Filipinos abroad reached $2.401 billion in July, higher by 5.2% from the $2.283 billion received a year ago.
Despite this, ING Bank N.V. Manila branch senior economist Jose Mario I. Cuyegkeng said monthly remittances remain inadequate to finance the monthly trade deficit, which drives the peso lower.
“This shortfall will continue and should keep the peso on a defensive bias,” Mr. Cuyegkeng said in a report.