Peso trades firmer on remittances

The Philippine peso opened the trading week on a strong note Wednesday after a four-day weekend as remittances from overseas Filipinos boosted the local unit.

The local currency gained 10 centavos to close at P50.040:$1 from 50.140 on Friday. Financial markets were closed on Monday and Tuesday for the Christmas break.

It was a “combination of strong remittance and equity inflows as well as US dollar softness over uncertainty of impact of US tax legislation,” Bangko Sentral ng Pilipinas Governor Nestor Espenilla Jr. said in a separate text message to reporters.

The volume was thin, but the flow of money transfers for the holiday continued to prop up the peso.

“Dollar remained sideways ... Thin trading but remittance flows still pushing the currency to break the 50 levels,” BDO Unibank Inc. chief market strategist Jonathan Ravelas told GMA News Online.

Ravelas noted the influx of remittances from overseas Filipinos for the holidays was the main driver for the peso. “At the moment it’s more of the inflows ... This could be temporary,” he said.

Two more trading days are left this 2017 before the market goes on a four-day weekend for the New Year’s holiday. Trading will resume on Wednesday, Jan. 3, 2018. — VDS, GMA News