The peso continued to appreciate as it reached a 57 mark against the US dollar on Thursday, Dec. 5, driven by the seasonal increase in remittances from overseas Filipino workers (OFWs) and the early conversion of dollars to pesos for holiday expenses.
Data from the Bankers Association of the Philippines showed the local currency climbed by 0.35 centavos from Wednesday's closing rate of P57.88 against the dollar.
On Thursday, the peso opened trading at P58.18 against the dollar, dipped to P58.21, but regained strength to close at P57.88. The dollar trading volume also decreased to $1.607 billion, down from $1.715 billion on Wednesday.
Michael Ricafort, chief economist at Rizal Commercial Banking Corp. (RCBC), said the peso continued its upward trend for the third consecutive day, with the US dollar/peso exchange rate dropping by 0.35 or 0.6% to close at 57.88, its lowest point in over a month.
Ricafort attributed this to the seasonal rise in OFW remittances and the conversion of dollars to pesos for holiday-related expenses, particularly as people prepare for Christmas shopping.
He added that this trend has been evident since late last week, with many people exchanging currency early after recent paydays in anticipation of the Christmas shopping season.
“For tomorrow [December 6th], the peso exchange rate could range between 57.75 and 58.00,” Ricafort forecasted.
HSBC ASEAN economist Aris Dacanay echoed this sentiment in a December 5th statement, saying, “further support [for peso appreciation] should come in due to the seasonality of remittances.”