Peso loses winning streak on less dovish Fed

After gaining strength against its US counterpart for three consecutive trading sessions, the Philippine peso softened on Thursday as the Federal Reserve released the minutes from its meeting.

The local currency lost 7 centavos to close at P52.13:$1 from P52.06:$1 Wednesday.

“The peso depreciated after the January Fed minutes appeared less dovish, contrary to market expectations from the communications made right after the January meeting,” Guian Angelo Dumalagan, market economist at Land Bank of the Philippines, said.

According to a report by Reuters, minutes from the Fed meeting on January 29 and 30 indicated that US policymakers see little risk to leaving rates alone for now.

“The minutes said that Fed officials opted to change its stance to a ‘patient’ approach but still open to the possibility of rate hikes if economic data would necessitate,” Dumalagan said. —VDS, GMA News