Peso seen in P51.50-P53.50 vs $1 range on global recession worries


Posted at Aug 19 2019 11:58 AM

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MANILA -- Fears of a global recession will likely strengthen the US dollar, potentially weakening emerging market currencies, including the Philippine peso, an analyst said Monday.

The peso might trade within a wider range of P51.50 to P53.50 against the dollar or "slightly below " the P54 level if trade tensions that sparked the recession worries worsens, said Mizuho Bank head of economics and strategy Vishnu Varathan.

"We are in the ironic position where despite lower US dollar yields, we have a very firm us dollar," Varathan told ANC's Market Edge.

"For most of the next half, we're looking at the peso on the softer side," he said.

The "bigger picture" of a slowdown in remittance growth means the Philippines has reduced buffers for the local currency and potentially weaker domestic consumption, he said.