Peso rises to P49:$1 level on GIR, oil prices
THE PESO rebounded to close at the P49-per-dollar level on Friday amid a decline in oil prices and the increase in the country’s foreign exchange buffers.
The local unit ended trading at P49.85 per dollar on Friday, rising by 31.5 centavos from its P50.165 close on Thursday, data from the Bankers Association of the Philippines showed.
Week on week, the peso also strengthened by 48 centavos versus its close of P50.33 per dollar on Nov. 5.
Friday’s finish is the peso’s strongest in nearly two months or since it closed at P49.79 per dollar on Sept. 15, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.
The peso opened Friday’s session stronger at P50.08 per dollar. Its weakest showing was at P50.105, while its intraday best was its finish of P49.85 versus the greenback.
The peso strengthened on Friday on lower oil prices and the country’s higher gross international reserves (GIR), a trader said in an email.
Reuters reported Friday that global pump prices dropped to wipe out gains from the previous session.
US West Texas Intermediate crude futures dropped 0.8% or 61 cents to $80.98 a barrel at 0749 GMT on Friday, rolling back Thursday’s 25-cent gain. Meanwhile, Brent crude futures dropped 65 cents or 0.8% to $82.22 a barrel.
Back home, the Bangko Sentral ng Pilipinas reported that GIR as of end-October rose 1.3% to $107.946 billion from $106.596 billion a month earlier. It likewise gained 4% from the $103.802 billion a year earlier.
At its end-October level, the dollar buffers are enough to cover 7.8 times the country’s short-term external debt based on original maturity and 5.4 times based on residual maturity. It is also equivalent to 10.8 months’ worth of imports of goods and payments of services and primary income.
Mr. Ricafort said the market was also anticipating the seasonal increase in remittances ahead of the Christmas season. — L.W.T. Noble