Peso weakens against dollar amid rising oil prices

The PESO fell against the dollar as oil prices rose. – NB FILE PHOTO

PESO weakens in the face of greenback on Thursday as oil prices hit multi-year highs.

Local unit closed at 50.88 P to the dollar on Wednesday, losing 23 centavos from its 50.65 P finish on Tuesday, based on data from the Philippine Bankers Association.

The peso opened Wednesday’s session a little stronger at P50.64 to the dollar. Its weakest performance was at P50.90, while its best intraday was at P50.61 against the greenback.

The dollars traded fell to $ 963 million on Wednesday, from $ 1.019 billion on Tuesday.

The peso depreciated in the face of safe haven demand as oil prices soared after major producers and their allies maintained their target production pace despite calls to increase production amid demand backdrop growing fuel, said Michael L. Ricafort, chief economist of Rizal Commercial Banking Corp. .

Oil prices surged on Wednesday after the Organization of the Petroleum Exporting Countries and their allies refused to increase production amid concerns about the world’s energy shortage, Reuters reported.

Brent crude hit $ 83.47 on Wednesday, the highest since October 2018, before settling at $ 82.52 a barrel at 8:13 a.m. GMT. Meanwhile, U.S. crude climbed to $ 79.78, the highest since November 2014, before falling 10 cents to $ 78.83.

Meanwhile, a trader said that the peso-dollar trade was also affAffected by expectations of a new report on private employment in the United States overnight.

ADP’s national employment report for August was due for release on Wednesday. The private payroll increased by 374,000 jobs in July.

For Thursday, Mr Ricafort gave a forecast range of P50.75 to P50.95 per dollar, while the trader expects the local unit to move between P50.80 and P51 against the greenback. – LWTN with Reuters

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