Peso steady versus dollar on PH GDP report

The peso inched up against the dollar on Thursday following the release of first-quarter gross domestic product (GDP) data.

The local unit closed at PHP 57.38 per dollar on Thursday, up by half a centavo from its PHP 57.385 finish on Wednesday, Bankers Association of the Philippines data showed.

The peso opened Thursday’s session weaker at PHP 57.44 against the dollar. Its intraday best was at PHP 57.33, while it dropped to as low as PHP 57.45 versus the greenback.

Dollars exchanged went down to USD 1.098 billion on Thursday from USD 1.16 billion on Wednesday.

“The peso appreciated due to acceleration in Philippine economic growth for the first quarter of the year,” a trader said in an e-mail.

Philippine GDP grew by 5.7% in the first three months of the year, faster than 5.5% in the fourth quarter but slower than the 6.4% in the same period a year ago,

This was below the 5.9% median forecast in a BusinessWorld poll of 20 economists held last week.

The softer-than-expected GDP growth could support a rate cut later in the year, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

The Bangko Sentral ng Pilipinas kept its policy rate at a near 17-year high of 6.5% for a fourth straight meeting in April after raising borrowing costs by 450 basis points from May 2022 to October 2023.

The Monetary Board will review policy on May 16, where it is expected to keep rates steady amid elevated inflation.

For Friday, the trader said the peso could rise ahead of a likely weak US consumer sentiment report. The trader sees the peso moving between PHP 57.25 and PHP 57.50 per dollar, while Mr. Ricafort expects it to range from PHP 57.25 to PHP 57.45. — AMCS