Peso weakens anew as investors focus on US, China

The peso tracked other regional currencies in losing against the dollar on Friday, as investors kept a close watch on developments in the world's two largest economies. 

 

The local currency remained above the 46:$1 level for the third consecutive day after dropping 6.5 centavos to 46.215 from the previous close of 46.15. Week-on-week, the local currency ended weaker by 47.5 centavos or over 1 percent. 

 

"The US dollar overpowered the strength of the Philippine peso today, as the focus returned to the timing of the US rate hike after last night's positive retail sales data," MetisEtrade Inc. analyst Cherica Vicente said. 

 

Data from the US Commerce Department showed that retail sales in the US climbed 0.6 percent in July. The figure supposedly reflects the sustained strength of the world's largest economy. 

 

"Since the US is a consumption-driven economy, the positive retail sales data shows that consumption can continue to drive the expansion. This supports bets for a US rate hike this year," Vicente said. 

 

The yuan devaluation also continued to put a drag on regional currencies, including the peso, as investors remain "sensitive" to the Chinese central bank's surprise move in the past two days, a currency trader told GMA News Online.

 

"The peso-dollar exchange rate is seen to range between the 46.00 and 46.30 levels in the week ahead as the market continues to focus on China and US," BDO Unibank Inc. Chief Market Strategist Jonathan Ravelas said. – VS, GMA News