Peso trades sideways amid cautious market

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The peso inched lower against the dollar on Monday, March 12, as market players took caution on the possible interest rate hikes coming from the central banks here and in the US.

The local currency ended Monday’s session at P52.04 versus the greenback, a centavo weaker than the P52.03-per-dollar finish on Friday.

The peso moved sideways the whole day, opening the session stronger at P51.95 per greenback. Its intraday low stood at P52.07, while its best showing was at P51.92 versus the US currency.

Dollars traded decreased to $507.9 million yesterday from its $592.1 million finish the previous session.

“The peso closed sideways as investors remained cautious on the dollar in view of March rate decisions by the Bangko Sentral ng Pilipinas (BSP) and the US Federal Reserve (Fed),” a trader said in an e-mail on Monday.

Chicago Fed President Charles L. Evans said he would prefer to “wait a little longer” than raising the Fed’s interest rates during this month’s meeting as its inflation continued to be low.

“My own preference would be to wait a little bit longer, let the March anomalous inflation rate from a year ago fall out,” Mr. Evans said in a CNBC interview.

For Tuesday, March 13, two traders see the peso to move between P51.90 and P52.10, while the first trader gave a slightly wider range of P51.90 to P52.20.

“Rates are still expected to move sideways ahead of uncertainty to the US February inflation data to be released [today],” the first trader noted. — Karl Angelo N. Vidal