• Peso breaches P47:$1 before closing back at P46

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    The peso broke through the P47: $1 psychological barrier in Tuesday morning trade before closing back at the P46 level, with the market buffeted by speculation that the dollar may rally soon on an impending US Federal Reserve key rate hike.

    The Philippine currency finished Tuesday’s trade at P46.93, paring the day’s loss down to 1 centavo. The volume of transactions on the Philippine Dealing System rose to $623.6 million from $569.33 million the previous day.

    The local currency hit its softest spot for the day at P47.040 and its firmest at P46.925.

    The central bank, as well as the traders, had expected the market’s volatility on speculation of a Fed monetary tightening as the US economy and financial markets approach normalcy amid a stabilizing economic recovery.

    Jonathan Ravelas, chief market strategist at Banco de Oro, said expectations of a US Federal Reserve rate hike fueled the greenback’s advance.

    He sees the local unit trading between P46.90 and P47.10 a dollar in the near term.

    MAYVELIN U. CARABALLO

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