THE government’s infrastructure push in the second half of 2019 could lead to the peso closing weaker against the dollar by yearend, according to HSBC Private Banking.
“We expect USD-PHP (US dollar-Philippine peso) to reach 54.0 by end-2019, given the re-widening of the current account deficit,” HSBC Private Banking Managing Director Chuek Wan Fan told reporters in a roundtable in Taguig City on Tuesday.
The peso ended 2018 at P52.58 versus the greenback, sharply down from its 2017 close of P49.93:$1.
The local currency is currently trading against the dollar within the P52:$1 level. On Tuesday, it closed 8 centavos weaker at P52.30:$1.
Fan said the expected peso depreciation this year would be led by the expected widening of the current account deficit, “especially going into the second half, because of the acceleration in public spending in infrastructure projects.”
This plan includes an infrastructure spending target of P792.97 billion for the second to fourth quarters after actual infrastructure spending reached P207.2 billion in the first.(M.U. Caraballo, TMT)