Peso up on US gov’t reopening hopes

The peso rebounded against the dollar on Monday on hopes that the longest US government shutdown was about to end.

The local unit closed at PHP 58.96 per dollar, strengthening by eight centavos from its PHP 59.04 finish on Friday, Bankers Association of the Philippines data showed.

The peso opened the session stronger at PHP 58.98 against the greenback. Its intraday high was at PHP 58.79, while its weakest showing was at PHP 59.075 versus the dollar.

Dollars traded increased to USD 1.38 billion from USD 1.21 billion.

The peso rose amid a weaker dollar after the US Senate agreed to a funding plan, potentially marking an end to the government shutdown, Rizal Commercial Michael L. Ricafort said in a Viber message.

For Tuesday, Mr. Ricafort sees the peso moving between PHP 58.85 and PHP 59.05 per dollar.

Hopes that the US government could soon reopen weighed on the safe-haven Japanese yen and boosted the growth-exposed Australian dollar on Monday, Reuters reported.

The US Senate on Sunday moved forward on a measure aimed at reopening the federal government and ending the shutdown. While it was a procedural vote, a handful of Democrat lawmakers have agreed a deal with the Republicans, and President Donald J. Trump said it looked “like we’re getting very close to the shutdown ending.”

Were the shutdown to be lifted, the focus would shift to US economic data, most importantly non-farm payrolls data, which has not been released since government operations ground to a halt more than a month ago. Market pricing currently reflects around a 60% chance of a US Federal Reserve interest rate cut in December, although that pricing could shift sharply in either direction once the data comes through. — AMCS with Reuters