The peso closed at its strongest level in two weeks against the greenback on Tuesday, returning to P46 to $1 territory as investors gained confidence following the Philippines’ generally successful and peaceful national and local elections.
The currency gained 34 centavos to close at P46.75 to $1 from its P47.09 finish on Friday last week. It was the local currency’s strongest finish in two weeks since closing at P46.65 to $1 on April 26.
“As mentioned last week, the market was skittish over the possibility of some form of domestic disturbance in relation to the elections, but with the polling exercise relatively peaceful, investors gained some confidence to invest anew,” Nicholas Antonio Mapa, associate economist at the Bank of the Philippine Islands said.
Mapa explained that traders closed long US dollar positions to book gains, while investors returned to snatch up beaten down stocks.
Mapa added, however, “Gains will be limited as the dollar remains upbeat against emerging markets with oil prices on the downtrend.”
The peso opened at P47.20 to $1 at the Philippine Dealing System before trading between P46.75 and P47.20. Total transactions rose to P824.65 million from P725 million previously.