The Philippine peso appreciated against the US dollar on Friday, moving back to the P58:$1 level after touching the P59:$1 barrier the day before, matching the record-low last recorded on November 26.
The local currency appreciated to P58.81:$1 from Thursday’s close of P59:$1.
The Philippine peso has been trading at P58:$1 for most parts of December with the local unit closing at P58.99:$1 on Wednesday, December 18.
In a commentary, Rizal Commercial Banking Corp. chief economist Michael Ricafort said that among the factors in the appreciation of the peso are the seasonal increase in OFW remittances and the conversion to pesos for holiday-spending.
“Favorable for OFWs, exporters, foreign tourists, foreign investors, and others that own or earn in US dollars and other foreign currencies to convert to pesos still relatively near the 59.00 record high, since they will get more peso proceeds, but offset by higher importation costs that could lead to some pick up in overall inflation since the Philippines is a net importing country,” Ricafort said.
“Going forward, the performance of the US dollar/peso exchange rate would still be partly a function of intervention/defense as consistently seen for more than two years already…amid the need to better manage inflation and inflation expectations to fulfill the price stability mandate that would also require stability in the peso exchange rate, which affects import prices/costs and overall inflation,” he added.
Since the start of 2024, the peso has shed P3.50 of its value against the US dollar. —NB, GMA Integrated News
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