Peso down on corporate demand, profit-taking

The peso weakened against the dollars on Thursday, as investors locked in profits after the US Federal Reserve stuck with its bond-purchasing stimulus and corporations bought greenbacks to settle month-end obligations. 

 

The local currency shed 11 centavos to cap the four-day trading week at 43.21:$1 from 43.10 Wednesday. Trading volume totaled $756.8 million from $486.8 million. 

 

"The dollar was stronger across after the Fed announcement," a trader said, adding that affirmation of bets that the Fed will keep its bond-buying program intact prompted investors Thursday to cash in on gains. 

 

"Buy-on-rumor and sell-on-news principle was at play," the trader said.  

 

The Fed has held interest rates near zero since late 2008 and has quadrupled the size of its balance sheet to more than $3.7 trillion through three rounds of bond buying, Reuters reported.  

 

The purchases are aimed at holding down longer-term borrowing costs, the wire service added.

 

In a separate interview with GMA News Online, a second trader said corporations were "scrambling" to meet month-end obligations offshore, fueling the dollar's rise...”

 

Oil, power and insurance were "most prominent... today. They were in a hurry given the shorter trading week," the second trader added. 

 

Financial markets will be closed on Friday for All Saints' Day. – VS, GMA News