The peso closed at its strongest level in three weeks in Monday’s trade as investors took their cue from weak US labor data for March and its likely influence on the Federal Reserve’s policy rate.
The Philippine unit strengthened to P44.39 to $1, gaining 19 centavos from P44.58 on April 1, the last day of trade on the Philippine Dealing System (PDS) before the financial markets closed for the Holy Week.
Monday’s rate was the highest finish for the peso since it settled at P44.30 a few weeks ago on March 13.
“The dollar’s strength evaporated with the weaker-than-expected labor data
reported from the US last Friday,” Nicholas Antonio Mapa, associate economist at the Bank of the Philippine Islands, said.
Mapa noted that with the US data for March showing nonfarm payrolls grew by 126,000, much lower than the anticipated 245,000, the Fed may be forced to delay its interest rate hike to a later date this year than expected by economists.
“This gives Asian markets some time to benefit from [fund]flows as foreign players
search for yield in the region,” he added.
The local currency opened at P44.44 to $1 on PDS on Monday before trading between P44.37 and P44.45.
Total volume of transactions fell to $654.1 million from $734.8 million in previous trade.