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Peso Ignores Fresh Tensions In South China Sea

PHP

MNI (Australia) USD/PHP has largely ignored the more positive USD/Asia trends seen elsewhere today. The pair remains comfortably within recent ranges, last just under 56.84. This leaves the well established 56.50/57.00 range firmly intact for now. The simple 50-MA (56.73) has been somewhat of a support point in recent weeks and has trended higher over this period.

  • The main local focus is on tensions with China. This comes after two Philippines vessels collided with China boats in the South China Sea. The Philippines government reportedly summoned the China Ambassador, while headlines also crossed that the Philippines was studying if the collision triggers its defense pact with the US (BBG).
  • The broader fallout for FX markets has clearly been limited though.
  • In the equity space, the PCOMP is down around 0.90%. The index is above September lows near 6000, but has fallen sharply in recent sessions. Offshore investors sold local equities last week.
  • The local data calendar just has the September budget on tap this week, out on Wednesday.

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