THE PESO may continue to move sideways against the dollar this week, likely holding at the P61 range, depending on the movement of global oil prices and as the market looks ahead to the release of key economic data.
On Friday, the currency surged by 32 centavos to close at P61.24 versus the greenback from P61.56 on Thursday, Bankers Association of the Philippines data showed.
This was its best finish in more than a month or since ending at P61.17 on June 29.
Week on week, the local unit jumped by 60.7 centavos from its P61.847 close on July 24, which is its all-time-low finish.
“The peso closed lower as the market tracked the dollar correction overnight following the release of soft US GDP (gross domestic product) and PCE (personal consumption expenditure) data, as well as the correction in oil prices,”a trader said in a phone interview.
The sharp drop in the Japanese yen also weighed on the greenback following intervention from the Bank of Japan and the US Treasury, the trader added.
Uncertainties over the implementation of the P85 wage hike in the National Capital Region (NCR) also supported the peso, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.
Labor Secretary Francis N. Tolentino said on Friday that they will seek legal remedies to overturn a court-ordered temporary freeze on the minimum wage hike in the NCR, arguing that the salary adjustment followed due process.
The order suspends the first tranche of P60, which took effect on July 25, to be followed by an additional P25 in January 2027.
For this week, the trader sees the peso moving between P61 and P61.50 a dollar as the market will continue to monitor developments in the Middle East, while Mr. Ricafort expects it to range from P61 to P61.60.
The trader said other trading drivers for the week are Philippine economic data on July inflation and second-quarter gross domestic product (GDP), as well out of the United States.
“Lower GDP will weaken the peso, but stronger NFP (nonfarm payroll) expectations may limit the downside further,” the trader said.
ABusinessWorldpoll of 21 economists and analysts yielded a median GDP growth estimate of 2.8% for the April-to-June period.
If realized, this would match the 2.8% growth in the first quarter but would be much slower than the 5.4% expansion in the same period in 2025.
This would bring average GDP growth for the first half to 2.8%, below the government’s 3.5%-4.5% full-year target.
The Philippine Statistics Authority will release GDP data on Friday (Aug. 7). —Aaron Michael C. Sy
