MANILA – An economist of ING Bank forecasts a Php44.85-45.50 range for the Philippine peso to the greenback due to volatilities caused by, among others, the expected increase in US interest rates within the year.
“This new range is likely to hold in the near term,” said ING Bank Manila senior economist Joey Cuyegkeng in his latest market report.
On Monday, the local unit ended at Php45.20, slightly weaker from the Php45.15 Thursday last week. There was no trading last Friday due to the celebration of the country’s Independence Day.
Cuyegkeng is positive that remittances from Filipinos abroad, which he projects to grow by five to six percent this year with inflows of about US$ 24 billion, will continue to support the local currency.
“Nevertheless, external factors continue to affect Php (Philippine peso),” he said.
The ING economist noted that the local unit “was the worst performer among Asian emerging market currencies last week” amidst the central bank’s report about the country’s strong external payments position.
The local currency has been generally weak in recent weeks on back of the widely expected hike in Federal Reserve’s interest rates as the US economy posts positive economic reports.
Monetary officials, however, remain confident that the peso would remain within the government’s target range of between Php42-45. pna
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