Peso strengthens after seven straight days of depreciation

THE Philippine peso appreciated against its US counterpart on Monday after seven straight days of depreciation, following hawkish remarks from the Bangko Sentral ng Pilipinas (BSP).

The local currency gained 11 centavos to close Thursday at P57.54:$1 versus last Friday’s finish of P57.65:$1, which was the weakest in 17 months since November 10, 2022’s close of P58.19:$1.

Rizal Commercial Banking Corp. (RCBC) chief economist Michael Ricafort attributed Monday’s “healthy downward correction” to the hawkish signals from local monetary authorities, after more cautious signals from Federal Reserve officials last week.

BSP governor Eli Remolona Jr., last Wednesday said policy rates could be cut by the fourth quarter of 2024, or as late as the first quarter of 2025 should inflation continue to be elevated.

Meanwhile, Federal Reserve chair Jerome Powell earlier signaled that there may be a delay in policy rate cuts, as inflation in the United States has been sticky.

Ricafort also cited the easing of tensions in the Middle East, after there was no new response or retalliation after the last attack made by Israel through missile attacks on Friday, April 19, 2024.

“The peso also slightly stronger vs. the US dollar after President (Ferdinand “Bongbong”) Marcos (Jr.) ordered the relaxation of rules on importation of agriculture products to help stabilize prices and overall inflation,” he said in a mobile message.

Marcos, through Administrative Order 20, ordered the removal of non-tariff barriers on the importation of agricultural products, and the streamlining of procedures and policies regarding such importation.