MANILA – Anticipation of the US Federal Reserve cutting its rates allowed the Philippine peso to end Thursday sideways against the greenback, but the main equities gauge succumbed anew ahead of the release of the June 2019 inflation report on Friday.
The local unit closed the day at 51.13, little changed against its 51.16 finish a day ago.
BPI Research traced this to increased speculations of a cut in Fed’s key rates following the release of the report that US’ private sector added 102,000 jobs last June, lower than expectations of about 140,000 increase.
“The latest turnout fueled expectations that the Federal Reserve is on track to reduce interest rates at its upcoming July monetary policy meeting,” it said.
The Federal Open Market Committee (FOMC) will have its fifth meeting this year on July 30 and 31.
With Fed rate hike expectations up, the peso opened the day at 51.18 against its 51.2 start in the previous session.
It traded between 51.2 and 51.04, resulting to an average of 51.096.
Volume reached USD775.7 million, lower than Wednesday’s USD924.2 million.
The currency pair is forecast to trade between 51.10 and 51.30 Friday.
On the other hand, the Philippine Stock Exchange index (PSEi) went down 0.34 percent, or 27.76 points, to 8,064.92 points, which BPI Research explained was due to a wait-and-see stance pending release of the inflation report by the Philippine Statistics Authority (PSA) on Friday.
The Bangko Sentral ng Pilipinas (BSP), for one, forecasts inflation in the sixth month this year to stay between 2.2 to three percent.
Rate of price increases posted an uptick to 3.2 percent last May from the previous month’s three percent and monetary officials believe that this is a one-off event.
The negative close of the main index gauge was tracked by the other counters, with All Shares down by 0.16 percent, or 7.64 points, to 4,931.99 points.
Holding Firms declined by 0.98 percent, Mining and Oil, 0.97 percent; Property, 0.27 percent; and Industrial, 0.13 percent.
On the other hand, Financials and Services rose by 0.89 and 0.25 percent, respectively.
Volume amounted to 740.03 million shares amounting to PH P5.1 billion.
Losers led gainers at 94 to 92 while 57 shares were unchanged. (PNA)
