Peso up as 2021 growth seen to hit gov’t target

THE PESO rebounded versus the greenback on Monday on expectations of within-target economic growth last year and the continued progress in the country’s vaccination drive.

The local unit ended trading at P51.29 per dollar on Monday, gaining eight centavos from its P51.37 close on Friday, based on data from the Bankers Association of the Philippines.

The peso opened Monday’s session stronger at P51.30 versus the dollar. Its weakest showing was at P51.35, while its intraday best was at P51.25 against the greenback.

Dollars exchanged declined to $827.5 million on Monday from $993.2 million on Friday.

A trader in an e-mail said the peso closed stronger on expectations that economic growth likely fell within the government’s target last year.

A BusinessWorld poll of 18 analysts yielded a median estimate of 6.5% for the fourth-quarter gross domestic product (GDP) growth. If realized, this would bring fullyear 2021 expansion to 5.3%, which is within the government’s downward-revised 5-5.5% target.

Analysts said growth in the last three months of 2021 was likely backed by the further easing of restrictions, which allowed more businesses to increase their capacity.

The Philippine Statistics Authority will release the full-year 2021 and fourth-quarter GDP data on Jan. 27.

The continued rise in the country’s vaccination rate also boosted sentiment, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

Data from the Department of Health showed more than 57.2 million individuals have been fully vaccinated as of Jan. 23. This represents 52.97% of the population, based on data from the Johns Hopkins University.

For Tuesday, Mr. Ricafort gave a forecast range of P51.20 to P51.35, while the trader expects the local unit to move within P51.20 to P51.45 per dollar. —