US rate hike concerns weigh on peso

The Philippine peso depreciated back to P50:$1 on Monday, dented by concerns about a rate hike in the United States.

The local currency closed Monday at P50.150, weaker by 28.5 centavos compared with P49.865 on Friday.

“The peso depreciated anew today, as investors diverted their attention to prospects of more US rate hikes this year after optimism on the passage of the local tax reform normalized,” Guian Angelo Dumalagan, market economist at the Land Bank of the Philippines told GMA News Online.

The Philippine peso strengthened to P49:$1 during the holiday season.

Dumalagan noted US economic data also helped strengthen the greenback.

“In terms of economic data, December 2017 reports on US average hourly earnings and jobless rate met expectations, even as nonfarm payrolls came out below the consensus,” he said.

“Moreover, investors are also expecting stronger US inflation data towards the end of the week. These reports, in general, are supportive of a stronger US dollar,” he said. —VDS, GMA News