Peso sinks to near 3-month low before US GDP

THE PESO declined to a near three-month low versus the dollar on Thursday ahead of the release of US gross domestic product (GDP) data.

The local unit closed at PHP 56.53 per dollar on Thursday, weakening by 23 centavos from its PHP 56.30 finish on Wednesday, based on Bankers Association of the Philippines data.

This was the peso’s weakest close since its PHP 56.73 finish on Oct. 31, 2023.

The peso opened Thursday’s session stronger at PHP 56.22 against the dollar. Its intraday best was at PHP 56.16, while its weakest showing was at PHP 56.57 versus the greenback.

Dollars exchanged went up to USD 1.47 billion on Thursday from USD 1.38 billion on Wednesday.

“The peso weakened anew due to some caution ahead of the US GDP report,” a trader said in an e-mail.

Fourth-quarter and full-year 2023 US GDP data were set to be released overnight.

The peso declined amid weak hot money data, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

Foreign portfolio investments posted a net outflow of USD 247.3 million last year versus the net inflow of USD 886.7 million in 2022, data from the Bangko Sentral ng Pilipinas showed.

Stronger-than-expected US manufacturing data also weighed on the peso as it reduced expectations of an early rate cut by the US Federal Reserve, Mr. Ricafort added.

For Friday, the trader sees the peso moving between PHP 56.30 and PHP 56.55 versus the dollar, while Mr. Ricafort expects it to range from PHP 56.40 to PHP 56.60.