USD/PHP Back Sub 56.00, Onshore Equities Looking At Fresh Multi Month Highs

USD/PHP sits back sub 56.00 in the first part of Friday dealing (last at 55.95). We are back close to mid Jan levels and around 0.30% stronger in PHP terms so far today. We are back sub the 20-day EMA (near 56.09), but remain close to the 50 and 100 day. Note the 200-day sits further south at 55.89. Recent highs in the pair we also marked just above 56.50.

• PHP has benefited from the broader USD pull back, aided by lower US teal yields. The improved global equity, plus lower oil prices is another positive.
• Local equities are also pushing higher, the PCOMP threatening to break to fresh multi month highs (last near 6700). PHP has benefited from the recent turn higher, albeit with a lower beta to such moves in recent months. Offshore investors have added modestly to local shares this week.
• The earlier Q4 GDP has likely aided sentiment at the margins for PHP and local equities.
• The next data point in focus will Tuesday's Jan CPI. The market looks for 3.0% y/y from 3.9% prior, although the m/m is projected at +0.6%, from 0.2%.
• Calls for easier BSP settings are likely to continue to be from some parts of the Philippines government, although the BSP itself is likely to be more cautious.