Foreign currency
• Previous week: Dollar strength pulled the movements in the foreign-exchange trading platform this week, causing the peso to lose value and go near the 45 territory. The deceleration started at the week’s start as it traded at 44.415 to a dollar on Monday, versus the previous week’s close of 44.3 to a dollar. This decelerated further to 44.55 to a dollar on Tuesday and at 44.75 to a dollar on Wednesday. The peso slightly corrected to 44.72 to a dollar on Thursday, and ended the week at 44.815 to a dollar. The total traded volume slightly rose during the week at $3.176 billion, compared to $3.161 billion in the previous week. The average value of the peso during the week is at 44.65 to a dollar, sharply decelerating from the previous week’s average of 44.274 against the dollar.
• Week ahead: Markets will still likely watch out for economic-data releases from advanced economies, particularly the United States, that will likely dictate the movement in the coming week, as the local central bank’s decision of an unchanged monetary-policy stance in its upcoming Thursday meeting has already been factored in by markets.
Monetary-policy stance
March 26, Thursday
• Previous monetary-policy stance: In its first monetary-policy meeting for the year, the Monetary Board (MB) decided to keep its key policy rates at 4 percent for the overnight borrowing, or reverse repurchase facility, and 6 percent for the overnight lending, or repurchase facility. The special deposit accounts interest rates were also kept steady at 2.5 percent, and the reserve requirement ratios were left unchanged for the meeting. Bangko Sentral ng Pilipinas (BSP) Governor Amando M. Tetangco Jr. said in his post-MB meeting statement that the seven-man monetary policy-making board made the decision to maintain all policy levers unchanged based on its assessment that prevailing monetary-policy settings remain appropriate due to the lower trajectory of inflation for the year.
• Upcoming monetary-policy stance: Economists polled by the BusinessMirror showed consensus in the view that the BSP will not change its monetary-policy stance in the March 26 meeting due to tame inflation dynamics and the uncertainty in oil-price movement and monetary-policy actions of advanced economies. The BSP is also seen to not join the wave of economies cutting rates to lift inflation number.