Peso stays at two-year low levels

The Philippine peso appreciated against the US dollar after three straight days of depreciation, albeit still at two-year lows, driven by the decline of global crude overnight.

The local unit gained 5 centavos to close at P52.39:$1 versus Tuesday’s finish of P52.44.

Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort attributed the appreciation to a mix of both local and international developments.

“The peso stronger vs. the US dollar today, a healthy correction after weakening for three straight days, after global crude oil prices eased overnight, President [Rodrigo] Duterte signed into law amendments to the Public Services Act, [and] completion of the ROP bond issuance,” he said in a mobile message.

Global oil prices eased overnight, but have since rebounded after data indicated that American crude stocks fell in the past week.

Duterte earlier this week also signed amendments to the Public Service Act (PSA), which reclassifies telecommunications, railways, airlines, and logistical facilities as public services versus their previous classification as public utilities.

This will allow 100% foreign ownership in the said services, as the 1987 Constitution provides that foreigners are only allowed to own a maximum of 40% in public utilities.

Aside from these, the Philippines also raised $2.25 billion from its first triple tranche dollar-denominated bond offering: $1 billion from the 25-year green bond offer, $500 million from the five-year bond offer, and $750 million from the 10.5-year offer.

“Peso also stronger after government’s measures to further accelerate the economy’s recovery from the COVID-19 pandemic and also to mitigate the adverse effects of the Russia-Ukraine war,” Ricafort said.

Socioeconomic Planning Secretary Karl Kendrick Chua earlier said that the amendments to the PSA, along with the Retail Trade Liberalization Act and the Foreign Investments Act will strengthen the country against the ongoing conflict. — BM, GMA News