The peso weakened to a six-month low against the US dollar Tuesday, pulled down by the possibility of an interest rate hike in the United States.
The local currency lost P0.29 to close at 47.455 Tuesday from 47.16 on Sept. 9. It was the peso’s weakest level since finishing at 47.545 on Feb. 29 this year.
Total volume turnover reached $851 million, higher than $711.6 million on Sept. 9.
The US Federal Open Market Committee is set to meet on Sept. 20 to 21 to find out if there is a need to increase interest rates. The last time the Fed raised rates was in December last year.
Nicholas Antonio Mapa, a research officer at Bank of the Philippine Islands, said investors continued to “rely on the safety of the greenback.”
Mapa said foreign players were getting out of the domestic market as they were becoming skeptical and unsure on what would happen next after the declaration of state of lawless violence by President Rodrigo Duterte, following a bomb blast in Davao City that killed 14 individuals.
Mapa said investors were not sure of the impact on the economy of the president’s move.