Positive US economic data weakened the Philippine peso as it returned to P44 to a dollar level at the start of the trading week.
The local unit closed P44.15 a dollar on Monday, shedding 30 centavos from P43.85 a dollar on Friday last week.
This is the peso’s lowest level since it depreciated to P44.24 On September 9, or exactly three months ago.
Sought for comment, Jonathan Ravelas, chief market strategist of BDO, said in a text message that the peso depreciation can be attributed to the stronger of US dollar backed by the good employment data coming out of the US.
“With the break of P44 and closing at P44.14; this now puts P44.50/P44.75 levels at risk,” Ravelas also warned.
The analyst also said that with this development, it would be difficult for the Philippine peso to attain the P43.25/P43.50 year-end target “despite the flow of remittances.”
Last week, the United States Labor Department reported that the world’s largest economy created 203,000 jobs in November. US unemployment rate recorded a five-year low of 7 percent from 7.3 percent in October.
The developments in the US economy boosted the chances of an early pullback on the US Federal Reserve’s $85-billion a month stimulus program for Asian markets.
“The US November employment report helped to reinforce expectations that the Fed will begin tapering soon, possibly as early as the FOMC [Federal Open Market Committee] meeting in mid-December,” Credit Agricole said.
“The jobs data followed on from several other firm US data releases over the week highlighting strengthening signs of recovery,” it added
On the other hand, the dollar was also steady in Asia on Monday as it fetched 102.96 yen in Tokyo afternoon trade, from 102.85 yen in New York City on Friday.
The euro changed hands at $1.3702 and 141.08 yen against $1.3705 and 141.03 yen in New York City also.
Minori Uchida, chief currency analyst at Bank of Tokyo-Mitsubishi UFJ, said that “the uptrend for the dollar/yen remains intact.”
“But given its hasty rally over the past month, people are reluctant to keep pushing it up for now,” he told Dow Jones Newswires.
Official data on Monday showed Japan logged a surprise 127.9 billion yen deficit in its current account—the broadest measure of trade with the rest of the world. The reading, which weighed on the yen, reversed a 420.8-billion yen surplus a year ago.
Meanwhile, the dollar was mixed against other Asia-Pacific currencies on Monday. It weakened to 32.14 Thai baht from 32.32 baht after Thai Prime Minister Yingluck Shinawatra announced she would call a general election in an attempt to resolve the political crisis gripping the country.
The greenback also declined to 61.04 Indian rupees from 61.60 rupees, to 1,053.35 South Korean won from 1,057.80 won, Sg$1.2510 from Sg$1.2536 and to Tw$29.55 from Tw$29.57. The unit rose to 11,980 Indonesian rupiah from 11,973 rupiah.
The Australian dollar rose to 91.07 US cents from 90.58 cents, while the Chinese yuan bought 16.93 yen from 16.72 yen.
WITH REPORTS FROM AFP