PHP has outperformed USD as sentiment....>

DOLLAR-PHP: PHP has outperformed USD as sentiment has improved. Participants

have focused on the bright side re: coronavirus situation, hoping that the

spread of the disease & its economic consequences can be contained. Elsewhere,

China decided to reduce some punitive tariffs on the U.S., further lifting risk

appetite. All eyes are now on the BSP, set to deliver its MonPol decision one

day after Thai policymakers cut rates to counter fallout from coronavirus.

- Most analysts anticipate that the BSP will trim borrowing costs. Governor

Diokno added to those expectations as he said today that it would be better to

cut interest rates sooner than later, given the lag in policy transmission. The

Governor added that he expects a further 50bp of easing this year. Re: PHP he

noted that it is stable & the central bank has "hardly" stepped into FX mkt.

- Elsewhere, Philippines' top diplomat said that Pres Duterte's plan to end a

military pact w/U.S. would hurt bilateral military & econ relations.

- USD/PHP trades at PHP50.75, 16 pips worse off. A fall below trendline support

at PHP50.73 would clear the way to the Jan 14 low of PHP50.37. Bulls eye the

23.6% retr. of Aug 15 - Jan 14 slide at PHP50.90, ahead of the PHP51.11 100-DMA.