Peso appreciates to 2-month high

The Philippine peso appreciated to a two-month high as the dollar hovered at two-month lows amid falling global oil prices.

It closed at PHP 55.37 a dollar, 20 centavos stronger than on Friday, according to Bankers Association of the Philippines data posted on its website.

This was the peso’s strongest finish since it closed at PHP 55.37 a dollar on Dec. 29, 2023.

The peso opened at PHP 55.59 a dollar, weakened to as much as PHP 55.65 and strengthened to as much as PHP 55.37 against the greenback.

Dollars exchanged dipped to USD 1.09 billion from USD 1.21 billion on Friday.

The peso gained as the dollar remained at two-month lows and as global crude prices eased, Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., said in a Viber message.

The dollar index rose by 0.06% to 102.74, hovering not far from Friday’s low of 102.33 — a level not seen since Jan. 15, Reuters reported.

Brent futures fell by 0.2% or 12 cents to USD 81.96 a barrel as of 7:23  a.m. GMT, while the US West Texas Intermediate (WTI) dropped by 0.2% or 21 cents to USD 77.80.

Both benchmarks fell last week, with Brent down by 1.8% and WTI 2.5% lower.

“The peso appreciated today after US Federal Reserve Chairman Jerome H. Powell affirmed market views of US policy rate cuts later this year,” a trader said in an e-mail.

Mr. Powell on Thursday told a Senate banking committee hearing the US central bank was “not far” from gaining the confidence it needs about falling inflation to begin cutting interest rates.

The Fed raised borrowing costs by 525 basis points from March 2022 to July 2023 to 5.25-5.5%.

The trader expects the peso to strengthen further on Tuesday as markets expect softer US inflation data for February.

The trader said the peso might move between PHP 55.20 and PHP 55.45 a dollar, while Mr. Ricafort sees it at PHP 55.30 to PHP 55.50. — Aaron Michael C. Sy