The peso briefly breached the 55-per-dollar level on Monday, but closed stronger to snap an eight-day depreciation since the US Federal Reserve raised the interest rate on June 16.
The peso touched 55.15 against the dollar, before settling at 54.78 at the close, stronger than the 54.985 level on Friday, but still the weakest in more than 16 years. Total volume turnover reached $1.179 billion Monday, down from $1.401 billion on Friday.
“The peso exchange rate strengthened [after depreciating for eight straight days], considered a healthy correction, by 0.205 or 0.4 percent to close at 54.78 [after the peso reached as low as 55.15 earlier in the day], as global oil prices recently lingered among 1-month lows and the 10-year US Treasury yield lingered among two-week lows,” Michael Ricafort, chief economist of Rizal Commercial Banking Corp., told Manila Standard in an email.
The peso retreated last week since the aggressive 0.75-basis point hike in the policy rate by the Fed, the biggest adjustment since 1994. Economists earlier said this would lead to a stronger US dollar against global currencies. Julito G. Rada