Peso firms up on Moody's review, US jobless data

The peso on Friday

firmed up on news Moody’s Investors Service is placing Philippine sovereign ratings under review and the poorer-than-expected jobless claims data in the US.

The local currency gained 3.5 centavos to end the week at 43.31:$1 from 43.345 Thursday. Trading registered at $1.008 billion from $722 million.

"The strength was driven by inflows following news that Moody's is looking at the Philippines for an upgrade," a trader at a local bank said.

On Thursday, Moody's said it is now reviewing its Ba1 rating for the Philippines, which is one notch below investment grade, for a possible shift to an investment grade—the next rating in line.

Moody's is the only debt-watcher left having a junk status on Philippine sovereign debt after the investment grade ratings from Fitch Ratings and Standard & Poor’s earlier in the year.

In a separate interview, a second trader said the market expects a more definitive statement from Moody's. Foreign exchange trading “more of tracked US jobless claims data” that blemished the greenback's appeal, he added.

"Market will price Moody's in slowly. For the day, jobless claims data, which was worse than expected, weakened the dollar across the board," he noted.

According to Reuters, the US Labor Department reported initial claims for state unemployment benefits increased by 7,000 to a seasonally adjusted 343,000, worse than economists expectations of 340,000 in the news wire's poll.

Both traders, however, agreed the Bangko Sentral ng Pilipinas helped temper the peso by buying as much as $200 million.

The first trader said the central bank was already "intervening" when the peso opened at 43.25:$1 and went on a "buying spree" when the local currency hit an intra-day high of 43.2. — VS, GMA News

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