Economy

Peso rebounds as oil prices ease

1000 peso bills

THE PESO rose slightly against the greenback on Friday as the climb in global oil prices eased and on expectations that quarantine restrictions in the country would be relaxed soon.

The local currency closed a tad stronger at P48.451 versus the greenback on Friday from its P48.50-per-dollar finish on Thursday.

The peso opened the trading session at P48.43 per dollar. It dropped to as low as P48.47, while its intraday best was at P48.39 against the greenback.

Dollars traded went down to $726.62 million on Friday from the $1.385 billion logged the day prior.

Week on week, however, the local currency weakened by 40.6 centavos from the P48.045 close on Feb. 11.

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The peso inched up after a healthy downward correction in global oil prices, Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp. (RCBC), said via Viber.

“[The peso slightly rose] after the Biden Administration signalled willingness to talk with Iran that could lead to new easing of sanctions on Iran oil exports, as well as some resumption of Texas/US oil production disrupted by unusually cold winter,” Mr. Ricafort said.

Global oil prices surged to one-year highs this week when extreme cold weather hit Texas, the largest energy-producing state in the US, Reuters reported.

The increase, however, eased by 0.6% on Thursday to settle at $63.93 per barrel for the Brent crude after peaking at $65 a barrel during the day’s session.

Back home, the possible easing of restrictions to a modified general community quarantine in Metro Manila sparked optimism and supported the peso’s rebound.

“The peso recovered following the unexpected rise in US weekly initial jobless claims and profit-taking by market participants,” a trader added.

The weekly report from the US Labor department released on Thursday showed jobless benefit claims rose by 13,000 to a seasonally adjusted 861,000 last week. This was higher than the 765,000 claims estimated by the economists polled by Reuters. — BML with Reuters

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