Peso closes at highs after lockdown announcement

PHILIPPINE STAR/ MIGUEL DE GUZMAN

The peso rebounded against the dollar Friday and strengthened past the P50-to-the-dollar level, with investors viewing the impact of the upcoming lockdown in Metro Manila as depressing demand for dollars.

The peso closed at P49.97 against its previous close of P50.305, according to the Bankers Association of the Philippines.

Week-on-week, it gained 37 centavos from its P50.34-a-dollar finish on July 23.

The peso opened Friday at P50.285. Its low was P50.34 while its high was the closing level.

Dollar volume was $1.364 billion Friday, against the $993.8 million posted Thursday.

The peso’s appreciation was due to the announcement of fresh restrictions in Metro Manila due to the spread of the Delta variant and its likely impact on the economic recovery, a trader who asked not to be identified said.

“(This) has dimmed views of growing local demand for the dollar anchored to the domestic economic recovery,” the trader said in an email.

The President’s Spokesman Herminio L. Roque, Jr. said Friday that Metro Manila will again enter lockdown between Aug. 6 and 20.

Socioeconomic Planning Secretary Karl Kendrick T. Chua on Friday told reporters that latest estimates have each week in lockdown costing the economy about P105 billion.

Infections on Friday rose by 8,562 to bring active cases to 61,920. Health authorities said Thursday said 97 more people were infected with the Delta variant, bringing the total to 216.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the dollar also weakened due to lower-than-expected gross domestic product data in the US.

US GDP rose 6.5% in the second quarter, against the 6.3% posted in the three months to March, Bloomberg reported Thursday, citing the Commerce Department’s preliminary estimates. The second quarter outcome was well below the 8.4% consensus in a Bloomberg poll. — Luz Wendy T. Noble

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