March 17, 2023 02:46 GMT
USD/PHP Breaking Down Through 50-Day MA
USD/PHP is back to fresh lows going back to mid Feb. The pair was last around 54.70. This puts us under the simple 50-day MA, which is around the 54.84 level. Dips below this support point have not been sustained over the past month, see the chart below. A sustained break sub this level will have the market targeting a move towards the 54.30/40 region.
- Incremental news flow has been positive for PHP today, with BSP Governor Medalla stating that Philippine Banks have no reported exposure to Credit Suisse.
- Next week the BSP meets, with a 25bps hike expected, as market expectations have adjusted lower in light of global developments.
- At the margin this is likely to be helping Philippines equities, with the main index up 0.80% today, although we are coming from depressed levels and remain sub the simple 200-day MA. Recent PHP trends have been more resilient to equity market weakness, like elsewhere in SEA (e.g. Thailand).
- The Jan budget balance also showed a much improved underlying fiscal position, (PHP45.75bn in surplus), in large part due to revenues +25% y/y.
Fig 1: USD/PHP Breaking Down Through 50-day MA
Source: MNI - Market News/Bloomberg
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