Peso to be range-bound ahead of US PCE data

The peso may remain range-bound against the dollar this week as the market awaits the release of the May US personal consumption expenditures (PCE) index report, which is the US Federal Reserve’s preferred inflation gauge.

The local unit closed at PHP 58.19 per dollar on Friday, weakening by six centavos from its PHP 58.13 finish on Thursday, Bankers Association of the Philippines data showed.

Week on week, the peso sank by 57 centavos from its P57.62 finish on May 17.

The peso depreciated against the dollar on Friday due to hawkish signals from minutes of the Fed’s latest meeting, Security Bank Corp. Chief Economist Robert Dan J. Roces said in a Viber message.

This, in addition to mostly stronger-than-expected US economic data lately, supported the dollar against other currencies, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

For this week, Mr. Ricafort said the May US PCE price index to be released on May 31, Friday, will likely be the main catalyst for peso-dollar trading.

US consumer sentiment data released last week will also affect the peso, Mr. Roces added.

Mr. Ricafort sees the peso moving between PHP 57.90 and PHP 58.30 per dollar this week, while Mr. Roces said foreign exchange trading could remain fluid. — A.M.C. Sy