The peso on Monday closed at its strongest in three weeks against the dollar following profit taking and stabilizing oil prices.
The currency gained 6 centavos to close at P47.16 to $1 from its P47.22 finish on December 23, before foreign exchange market operations were suspended for the Christmas holidays.
Monday’s finish was the strongest since December 8, when the peso stood at P47.12.
Bank of the Philippine Islands (BPI) associate economist Nicholas Antonio Mapa said the dollar slipped on profit-taking and as oil prices floated back to more normal levels.
“In the wake of the Fed’s first rate hike in nearly a decade, crude oil prices were sent hurtling toward multi-year lows. A confluence of events supposedly caused the steady decline as OPEC [Organization of Oil Exporting Countries] removed production ceilings, the US lifted an export ban and crude oil stock piles increased,” he said.
Mapa said Nymex crude was sent to the $34 per barrel level shortly after the Fed decision but since staged a mini resurgence to $38.01 per barrel on Thursday.
“Investors were quick to call for the demise of the crude oil markets citing supply gluts and weaker global growth. In response, China unveiled an aggressive stimulus package and stockpiles unexpectedly fell by 5 million barrels,”he noted.
The peso opened at P47.13 to $1 at the Philippine Dealing System before trading between P47.12 and P47.20. Total transactions fell to P280.75 million from P427 million last Wednesday.