PHILIPPINE financial markets opened the week on a weak note as both the stock market and the peso posted their weakest showings in months following the movement in global crude oil prices.
The local currency shed 46.5 centavos to close Monday at P56.78:$1 from last Friday’s finish of P56.315:$1. This is the same record on Nov. 24, 2022, and the weakest since the peso closed at P56.94:$1 on Nov. 23, 2022.
The latest depreciation was attributed to the movement in global crude oil prices which hovered among nine-month highs, as data from the International Energy Agency (IEA) indicated that world demand increased to a record in June, and may rise even further this month.
“(This) could still lead to higher local fuel pump prices and some uptick in prices and overall inflation, as well as larger import bill and wider trade deficit for the country,” Rizal Commercial Banking Corp. (RCBC) chief economist Michael Ricafort said in a commentary.
Inflation clocked in at 4.7% in July, marking the sixth straight month of deceleration, but still above the government’s target range of 2.0% to 4.0%.
Local fuel companies, meanwhile, are set to hike prices per liter of gasoline for the fifth straight week, and diesel and kerosene for the sixth on Tuesday, Aug.15.
Ricafort also cited the third straight trading day that the local stock barometer PSEi declined as it lost 76.72 points or 1.2% to a nine-month low of 6,329.19 at the closing bell, the weakest since Nov. 15, 2022. The broader All Shares index slid by 32.30 points or 0.94% to 3,397.89.
“Philippine shares tumbled as investors looked ahead to a key inflation reading that could impact the Fed’s next rate move, while others took to the sidelines as GDP came in lower than was forecasted,” Regina Capital Development Corp. head of sales Luis Limlingan said in a separate commentary.
The local economy expanded by 4.3% in the second quarter of the year, slower than expected by most analysts, and the slowest in nine quarters since the country returned to positive territory after the pandemic-induced recession.
More than 716.166 million shares, valued at P4.578 billion, changed hands during the session. Decliners led advancers, 118 to 45, while 53 issues were unchanged. (GMA Integrated News)
