THE Philippine peso slipped to a fresh record low Monday, closing at 61.75 against the US dollar, down 2.9 centavos from its previous finish of 61.721 on Friday.
Data from the Bankers Association of the Philippines showed the local currency opened at 61.69 per dollar and touched an intraday low of 61.75 before settling at its weakest level for a third straight trading session.
A trader attributed the continued depreciation to the peso trading more on sentiment than valuation.
“The dollar remains broadly strong, but today’s move also reflects demand for safety, higher oil-related dollar demand and a market that is becoming more sensitive to domestic uncertainty,” the trader said. “At these levels, positioning and momentum also matter, which can exaggerate moves in thin liquidity.”
The trader said the bias for a weaker peso remains in the near term, noting that the 62-per-dollar level is now psychologically within reach, though sharp swings in both directions are also likely.
Meanwhile, Philippine shares extended their decline Monday amid thin trading and a lack of positive catalysts to push the market higher.
The Philippine Stock Exchange index fell 35.25 points, or 0.59 percent, to close at 5,941.52, while the broader all shares index declined by 17.28 points, or 0.5 percent, to 3,354.13.
Regina Capital Development Corp. head of sales Luis Limlingan said investors were disappointed by the lack of a major policy breakthrough during the meeting between US President Donald Trump and Chinese President Xi Jinping. The lack of a peace deal to end the conflict in the Middle East also caused investors to remain cautious over higher fuel prices and inflation.
As investors opted to stay on the sidelines, value turnover was anemic at P3.84 billion. Foreign investors were net sellers, with outflows at P225.7 million.
Among the sectoral indices, only property closed in positive territory, up 0.19 percent. The rest declined, led by mining and oil, which dropped 3.43 percent.
AREIT Inc. led index gainers, rising 3 percent to P39.50, while Ayala Corp. was at the bottom, falling 3.81 percent to P42.90.
The peso held steady Monday, closing at 61.75 to the U.S. dollar from 61.721 on Friday.
Asian markets lost ground on Monday, extending slides in global markets as the impasse in the war in the Middle East again drove up oil prices and spurred fears of sustained inflation even if a ceasefire holds.
The United States and Iran agreed to a truce in April but negotiations have stalled and sporadic attacks in the region have continued.
US President Donald Trump issued a new warning to Tehran on Sunday, saying it must move quickly towards a peace deal or “there won’t be anything left of them”.
The conflict has led to an effective blockade of the Strait of Hormuz, through which around 20 percent of global oil exports pass in peacetime.
The strait “remains meaningfully closed — now approaching eleven weeks — after the Trump-Xi summit in Beijing concluded without a breakthrough on reopening the waterway”, MUFG’s Michael Wan said Monday.
Tokyo shares closed one percent lower and Shanghai lost 0.1 percent, while Hong Kong ended down 1.1 percent.
Sydney, Taipei, Singapore and Wellington also fell, with Jakarta tumbling 3.8 percent.
But Seoul, which has renewed with record highs in recent days thanks to the artificial intelligence spending boom, ended the day 0.3 percent higher.
But government bond yields have risen worldwide in recent trading sessions as more investors start to question if inflation will begin eroding economic growth while pressuring deficits.
“Global government yields rose sharply heading into the start of this week, as three forces collided: surging oil prices, fading hopes for a Strait of Hormuz resolution, and mounting fiscal concerns especially in the UK and US,” Wan said.
But last week’s talks on trade between China and the United States have offered “a degree of relief for Asian markets”, he added.
– ‘Wave’ of AI demand –
China’s consumer spending in April grew at the slowest pace in more than three years, data showed, a stark sign of the challenges Beijing faces to reignite domestic activity.
In Tokyo, shares in memory chip maker Kioxia soared 16 percent following stellar quarterly results on Friday.
Kioxia, the world’s third-largest producer of NAND flash memory chips, which are used as storage in AI data centers, has seen its stock surge nearly 300 percent over the past year.
The company has forecast an eye-watering 1.3 trillion yen ($8.2 billion) in operating profit for April-June, saying it is “riding the large wave of AI demand, which has led to record high revenue and profits”.
In South Korea, Samsung Electronics, which has also profited massively from the AI memory chip boom, resumed union talks in a bid to avoid a strike over bonus payments.
Samsung shares closed 3.8 percent higher after a court on Monday granted the company an injunction that restricts the scope of the strike, due to begin Thursday, to ensure sufficient staffing levels for safe production and quality control.
Later in the day, traders will have their eye on a meeting of G7 finance ministers and central bank chiefs that kicks off in Paris, with bond selloffs in the spotlight, analysts said.
Then all eyes will be on quarterly results from US chip titan Nvidia, set for Wednesday, which will be scrutinized as investors question whether huge spending on AI data centers is justified by potential returns. With AFP
