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Peso dips as trade war tensions subside

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THE PESO weakened on Tuesday, May 15, over indications of easing US and China relations after US President Donald J. Trump’s pronouncements on extending assistance to Chinese telecommunications giant ZTE, amid a brewing trade war between the two countries.

The local unit closed at P52.29 against the greenback on Tuesday, shedding 10 centavos from the P52.19 finish on Friday.

The local currency immediately slid to P52.36 as the market opened, then depreciated further to P52.5 per dollar to be its intraday low.

The peso’s peak for the day was P52.25 versus the dollar.

The volume of dollars traded grew to $1.35 billion from the $1.13 billion recorded on Tuesday.

“The peso dipped strongly today as US and China trade relations eased over the long weekend after Pres. Donald Trump intended to extend assistance to Chinese telecom ZTE, which was seen to be heavily affected by the trade tensions between the two major economies.” a trader said in an email yesterday.

However, he added that traders took profits when the local currency touched the P52.5 per dollar resistance that tempered the overall depreciation. — Elijah Joseph C. Tubayan