PHP falls to 11-year low on likely hike in Fed rates this month

The Philippine peso on Friday fell to its new 11-year low on higher possibility of a hike in the Federal Reserve rates this month.
(Photo: Cheng Ilagan/Philippine Canadian Inquirer)

MANILA—The Philippine peso on Friday fell to its new 11-year low on higher possibility of a hike in the Federal Reserve rates this month.

But the Philippines Stock Exchange index (PSEi) inched up anew as it tracked Wall Street gains.

The local currency fell to its weakest since its 50.43 close on Sept. 12, 2006 after it finished the week at 50.40 against the greenback.

A trader said probability rate of an increase in the Fed’s key rates, once the Federal Open Market Committee (FOMC) meets on March 14 to 15, had risen to about 90 percent to date.

The trader said markets were now more hopeful for another rise in the Fed rates due to hawkish statements by US monetary officials.

Amid this the peso remained firm when it opened in the morning at 50.34 from day-ago’s 50.30.

Investors’ risk appetite remained unchanged, resulting in the wide trading range for the currency pair during the day, with its closing rate as the weakest while strongest level stood at 50.31, bringing the average to 50.37.

Volume of trade amounted to USD482.1 million, up from the USD 409 million in the previous session.

The currency pair is seen to trade between 50.20 and 50.50 next week.

PSEi, the main stocks index, rose 0.17 percent, or 12.18 points, to 7,247.12 points, which a trader said was in line with the region.

All Shares ended at 4,385.86 points, up 0.16 percent or 6.99 points.

Most of the sectors took their cue from the main index led by Property with 0.22 percent increase.

Services, Financials and Holding Firms followed with hikes of 0.17 percent, 0.12 percent and 0.07 percent, respectively.

Mining and Oil and Industrial, meanwhile, declined by 0.43 percent and 0.11 percent, respectively.

Some 1.49 billion shares amounting to Php 5.5 billion churned in the week’s last trading day.

Losers led gainers at 92 to 81 while 61 shares were unchanged.