MANILA - The rate at which the peso weakens against the dollar could slow in the near term after the US Federal Reserve left interest rates unchanged, the central bank said Thursday.
Monetary authorities, however, remain on the lookout for excessive market reactions, Bangko Sentral ng Pilipinas (BSP) Governor Amando Tetangco said in a text message to reporters.
The peso strengthened to as much as P47.70 to the dollar on Thursday from Wednesday's close of P47.89.
"The Fed's holding off further action shows it can be a little bit more patient," Tetangco said.
"For our markets this may mean that we could possibly see some slowing in the weakness of the peso in the near term until the next Fed meeting again," he said.
The Fed's decision and Tetangco's remarks came ahead of the BSP's policy meeting on Thursday, with its Monetary Board widely expected to leave policy settings unchanged.