THE PESO fell to a nearly two-week low against the dollar on Thursday as the foreign exchange market awaited additional indications from US President Donald J. Trump regarding his proposed tariff measures.
The domestic currency finished at P58.692 per dollar on Thursday, declining by 18.2 centavos from its P58.51 close on Wednesday, according to data from the Bankers Association of the Philippines.
This marks the peso’s lowest closing since it ended at P58.70 on Jan. 13, nearly two weeks ago.
The peso began Thursday’s trading session slightly weaker than Wednesday’s close at P58.54 per dollar, which was already its best intraday rate. Its lowest point for the day was P58.70 against the greenback.
Transactions in dollars dropped to $1.27 billion on Thursday from $1.59 billion on Wednesday.
“The peso finished lower due to robust dollar demand as traders anticipate updates on Trump’s policies,” a trader commented in a phone conversation.
The dollar generally gained strength on Thursday after Mr. Trump threatened to introduce tariffs on Russia should it not cease its invasion of Ukraine, noted Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort in a Viber message.
Looking ahead to Friday, the trader suggested the peso might fluctuate between P58.50 and P58.80 per dollar, whereas Mr. Ricafort predicts a range of P58.55 to P58.75.
The dollar traded within narrow parameters against its major counterparts on Thursday, as the currency continued to seek direction amidst the lack of definitive announcements regarding tariffs from Mr. Trump, as reported by Reuters.
A series of central bank policy decisions may influence currencies in the upcoming week, with the Bank of Japan widely anticipated to raise interest rates at the conclusion of a two-day meeting on Friday.
Decisions regarding rates from the US Federal Reserve and European Central Bank are set for Wednesday and Thursday of the following week, respectively.
The dollar index — which gauges the currency against six prominent rivals, including the euro and yen — was recently up 0.09% at 108.37 in early European trading.
It plunged 1.2% on Monday, experiencing its sharpest one-day decline since November 2023, as Mr. Trump’s first day in office saw a flurry of executive orders but none addressing tariffs.
The dollar had ascended to a more than two-year peak of 110.17 on Jan. 13, fueled by a robust US economy and expectations of widespread tariffs, which could impact other nations’ currencies negatively.
This week, Mr. Trump has suggested imposing tariffs of approximately 25% on Canada and Mexico and 10% on China effective Feb. 1. He also indicated potential duties on European imports, though specifics were not provided.
On Monday, Mr. Trump signed a trade directive instructing federal agencies to evaluate multiple trade matters by April 1, which many market players consider to be a pivotal date in unveiling tariff strategies.
The dollar was up 0.15% against China’s yuan in offshore trading at 7.294 yuan. Since Mr. Trump’s inauguration, it has decreased around 0.5% against the yuan, also referred to as the renminbi.
Japan’s yen remained unchanged at 156.49 per dollar, with markets assessing a 96% likelihood of a quarter-point increase on Friday. — A.M.C. Sy with Reuters
