THE PESO declined slightly on Tuesday as fresh tensions in the Middle East boosted demand for the safe-haven dollar, and as the market weighed weak economic data.
The currency depreciated by four centavos to end at P62.80 versus the greenback from its P62.76 finish on Monday, Bankers Association of the Philippines data showed.
The local unit opened the session nearly flat at P62.75 per dollar. It climbed to a high of P62.70, while its intraday low was P62.869 against the greenback.
Dollars traded inched down to $1.022 billion from $1.056 billion.
The peso edged down amid renewed tensions in the Middle East, with markets also waiting for the release of key US inflation data for leads on the US Federal Reserve’s next move, a trader said by phone.
The currency was also dragged lower by data showing a decline in Philippine foreign direct investment (FDI) inflows, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.
Net inflows of FDI dropped by 44.1% year on year to $689 million in July from $1.233 billion a year ago, preliminary data from the Bangko Sentral ng Pilipinas (BSP) showed.
Still, this was the highest inflow in six months or since the $799 million in January, but marked the first annual decline since April.
For the first seven months, net inflows of foreign direct investments went down by 23.9% year on year to $4.071 billion from $5.35 billion.
Net FDI inflows are expected to reach $6.5 billion this year, according to the BSP’s latest projections.
For Wednesday, the trader said the peso could stay rangebound and move between P62.60 and P62.90 per dollar as players await US data, while Mr. Ricafort said it could range from P62.70 to P62.90. — Aaron Michael C. Sy