Weaker, USD/PHP Through 200-day MA

USD/PHP has continued to climb this afternoon, heading back towards earlier highs at 56.20. We were last 56.16. We are now threatening highs from back in mid-April, which came in at 56.385. At this stage we are through the simple 200-day MA around 56.10.

• Earlier comments from BSP Governor Medalla were noteworthy, with the governor noting that there are other ways to loosen policy besides cutting rates. One such option is a RRR cut.
• Market speculation has risen around a potential RRR cut around the middle of this year.
• These comments come after the Governor stated yesterday the central bank may pause at Thursday's policy meeting.
• Equities are welcoming the news, the PSEi up around 1% so far today, but the FX markets have been less supportive.
• A break above April highs in USD/PHP may test the authorities resolve, but clearly some type of policy loosening is starting to form in terms of BSP thinking.