Peso strengthens, hits P49 to $1 after 3 years
The peso closed at an intraday high of P49.80 on Friday, June 5, the strongest since June 2017.
RCBC chief economist Michael Ricafort attributed the peso's strength to fewer cases of COVID-19 around the globe, which then boosted business sentiment.
Ricafort added that the move of debt watcher S&P Global Ratings to affirm the country's BBB+ credit rating and stable outlook lifted the local currency.
"Sentiment on the local financial markets this week has been largely supported recently by S&P's affirmation of the Philippine credit ratings at two notches above the minimum investment grade with stable outlook, despite the downgrade on some countries worldwide," Ricafort said.
The move, he added, is "a sign of resilience and a strong vote of confidence by international investors on the country's relatively stronger economic and credit fundamentals in recent years." (READ: What the Philippine economy could be like after the coronavirus)
While the strong peso has perks like lower prices of oil and other goods, it also poses disadvantages.
For instance, families of overseas Filipino workers will get less cash when the dollars sent are converted into pesos. – Rappler.com