The Philippine peso plunged to its weakest this year as it slumped at P43.84 to a dollar at the start of the week.
The local currency depreciated 12 centavos from the P43.72 close on Friday last week.
Monday’s close was also weaker compared to Thursday’s P43.80 to a dollar.
In its weekly review of the financial markets, the Bank of the Philippine Island (BPI) Asset Management said that the Philippine peso continued to depreciate against the greenback, as the outcome of the US Federal Open Market Committee (FOMC) meeting was being made public.
Week-on-week, the local currency surrendered 92 centavos to close at P43.720.
FOMC revealed that the Fed may start reducing its bond purchases before the year ends.
BPI Asset Management also said that the peso will continue to depreciate for the week ahead.
“On the local fixed income and currency markets, profit-taking may persist, pushing yields higher and continuing to weaken the peso,” it stated.
The report added that market players will remain in defensive positions as economic data releases on the global economic front, particularly on the United States and euro-zone, are being monitored by market players.
“The currencies market had a quiet start to the trading week as market players remained cautious ahead of the Federal Open Market Committee,” it said.
BPI Asset Management also said that following the results of the FOMC meeting, the greenback climbed against majority of its major counterparts as statements from the Fed indicated that a tapering down of bond-buying could begin by the latter part of the year, and fully halted by the middle of 2014.