THE PESO may remain weak against the dollar this week as the renewed Middle East conflict continues to pressure market sentiment.
On Friday, the peso rose marginally by 3.3 centavos to close at P61.587 per dollar from Thursday’s P61.62. However, it declined by 7.2 centavos year-over-year from its P61.515 level on July 10.
Market analysts noted the dollar-peso fluctuated within a narrow range of P61.555 to P61.62 due to limited catalysts, with traders awaiting developments in the Middle East, according to a source.
The dollar weakened amid lower US Federal Reserve hawkish expectations following weaker economic data, per Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort. He also highlighted positive sentiment from Indonesia’s $5 billion offer to First Gen Corp for its renewable energy subsidiary, which could boost local markets and attract dollar inflows.
This week, the peso’s movement will hinge on US-Iran conflict updates, particularly weekend events, as per the trader’s assessment.
Mr. Ricafort warned that the P85 wage hike in the NCR, effective July 25, might trigger inflationary pressures. The minimum wage will rise to P755 for nonagricultural workers and P718 for agricultural and service-sector employees, with a P25 increase scheduled for January 2027.
The trader predicts the peso will trade between P61.40 and P61.70 this week, while Mr. Ricafort forecasts a range of P61.35 to P61.75. — Aaron Michael C. Sy
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