Peso weakens to 2-month low of 47.08 to $1

The peso slid to a fresh two-month low of 47.08 to $1 Wednesday amid jittery markets ahead of the May 9 elections.

Wednesday’s close matched the 47.08-to-$1 close last March 3, before the local currency strengthened to the 46:$1 level in two months leading to the elections.

The peso closed at 46.85 to a dollar last Tuesday. It opened at 47 to $1—its intraday high—and hit a low of 47.12:$1.

The total volume traded rose to $793 million from Tuesday’s 541.2 million.

In its weekly report to clients, Metrobank Research blamed the weaker currency on election jitters.

“Locally, US dollar-Philippine peso [trade] will likely be supported given the uncertainty of the upcoming elections, with players preferring to hold on to safe-haven bets,” Metrobank Research said.

It said “47:$1 remains to be the first line of defense at the top, but momentum is clearly to the upside. Expect the local pair to trade in a 46.50-47.30:$1 range this week, with the Bangko Sentral ng Pilipinas present to smoothen volatility.”

ING Bank Manila senior economist Joey Cuyegkeng last Tuesday said the peso might weaken to the 47.50:$1 level and could only bounce back if markets deemed the next president as one who could sustain the economic gains made thus far.

Cuyegkeng had noted that historically, elections have been bringing about weakness in currencies amid uncertainty among investors.

According to Cuyegkeng, the post-election period usually brings a rally in markets following the slump.