THE peso on Tuesday posted a fresh six-year low against the US dollar, shedding P0.11 to close at 47.995 from 47.88 Monday, as declining oil prices dragged down equities and currencies in the region.
It was the local currency’s weakest level since the 48.05 recorded on Sept. 16, 2009, at the height of the global financial crisis. Total volume turnover stood at $596.7 million, lower than$644.5 million on Monday.
“Asia [is] no longer taking its cue from China but more so on the direction of oil prices. With oil reversing into losses overnight, risk-off sentiment greeted Tuesday’s trading,” Nicholas Antonio Mapa, research officer of the Ayala-controlled Bank of the Philippine Islands, said in an e-mailed message.
“Equities and currencies in the region all down, with the peso and the PSEi [Philippine Stock Exchange index] not spared,” Mapa said.
He said unless anything substantial change in oil was seen, equities and currencies might be “in these rough waters for a while.”
The peso opened Tuesday’s trading at 47.98, P0.10 weaker than the 47.88 at the close on Monday. Before noon, the peso already touched the 48-a-dollar level.
Banco de Oro’s Jonathan Ravelas said volatility would keep the peso weaker going forward. “If [the] peso closed above 48 [Tuesday],it could try 48.50 for the week,” he said.
The peso’s weakest level in 2015 was recorded on Dec. 17, when it closed at 47.395, a day before the US Federal Reserve decided to increase interest rates.
The peso breached the 47-a-dollar level on Nov. 9, closing at 47.16 from 46.935 a day earlier. If further weakened to 47.26 on Nov. 10 as the imminent Fed lift-off strengthened the dollar against other currencies.
The Bangko Sentral earlier ruled out the possibility of a peso devaluation, saying the country’s macroeconomic fundamentals remained strong.
Bangko Sentral officials said the Philippines had resilient domestic factors including consumption, private capital formation and public spending.
Bangko Sentral is sticking to its previous forecast of a 43 to 46 average for the peso this year.
First Metro Investment Corp. officials projected the peso to trade between 48 and 49 to a dollar in 2016, citing volatilities in the global financial markets.