Downward pressure persists on global markets as a much stronger-than-expected US jobs report raised the prospect that the US Federal Reserve will maintain its aggressive monetary policy to combat inflation.
Official data published Friday showed the US economy added 528,000 positions, defying all expectations of a slowdown.
Friday’s data also showed US wages jumped, which will add to inflation concerns and likely push the Fed to raise rates aggressively again next month.
The Fed has previously said its decision will be guided by data.
Markets fell after the “absolutely monster” jobs report leaves “the Fed with all the ammo it needs to keep on hiking a lot more,” Markets.com analyst Neil Wilson saod.
The peso had recovered strongly to close the week at 55.20 per dollar, the strongest for the currency for more than a month.
Global oil prices slip
“Global oil prices recently declined to new six-month lows, with the benchmark Nymex now at $89 per barrel (against $92 at the start of the Russia-Ukraine conflict and sharply down from the high of $130.50 on 7 March 2022),” Rizal Commercial Banking Corp. chief economist Michael Ricafort said.
Moreover, Ricafort added that the sentiment on the peso has partly supported plans by the economic team of President Ferdinand “Bongbong” Marcos to reduce foreign borrowings and instead increase the share of local financing in the total mix for the coming months to better manage risks related to foreign debt.
For the week, the peso was slightly weaker against the dollar, by 0.07 or 0.1 percent (after the previous week’s sharp peso appreciation of P1.15 or 2 percent).
Since the start of 2022, the peso still depreciated by P4.201 or 8.2 percent, Ricafort said.