We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bullish
Oil - US Crude
Mixed
Wall Street
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Mixed
USD/JPY
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • The trio of central banks overseeing the commodity currencies have already cut their main rates to all-time lows. Get your market update from @CVecchioFX here: https://t.co/OSUXrN5P3j https://t.co/Cxt86jl28N
  • The Japanese Yen fell for a third consecutive week with price testing resistance into June open. Here are the levels that matter on the $USDJPY weekly technical chart. Get your #currencies market update from @MBForex here: https://t.co/1QPXP0g7Ew https://t.co/WUtXHoRoQX
  • $USDZAR: A rally from here could be an important tell as to whether the level seen as support previously (17.76) will turn into a point of resistance for sellers to lean against. Get your $USDZAR technical analysis from @PaulRobinsonFX here:https://t.co/TNsQ4JJu6E https://t.co/I4yCjs2ja0
  • The US dollar continued to sell-off this week and the greenback’s future will be decided by commentary from the White House and not the Federal Reserve over the coming days and weeks. Get your #currencies market update from @nickcawley1 here: https://t.co/lpHneO3s2h https://t.co/bZ5klohLNd
  • #Gold prices have continued to push higher as expectations have built for global Central Banks to remain very loose and passive with monetary policy for the foreseeable future. Get your $XAUUSD technical analysis from @JStanleyFX here: https://t.co/h5tF3kAZfd https://t.co/VAYy9FGHcQ
  • Major investment bank models have touted USD selling, given the outperformance in US equities relative to its counterparts over the past month. How is this likely to impact the month-end rebalancing? Find out from @JMcQueenFX here:https://t.co/MtNrHmXZpD https://t.co/YvoHlUsdVr
  • U.S. Market Analyst at https://t.co/JsVsSmefgR, Shain Vernier covers - ✔️ Safe haven assets in volatile markets ✔️ Central banks and governments ✔️ How will commodities trade in a recession Only on Trading Global Markets Decoded #podcast. Tune in here: https://t.co/1UmEzEbwiy https://t.co/X15k6b4ZyB
  • The month of May saw equities rise across the board. The #Dow Jones and #DAX 30 will look to hold above nearby support while the #Nasdaq 100 may look to attack all-time highs. Get your #equities market update from @PeterHanksFX here: https://t.co/dQxkG68R0I https://t.co/cgfcOs14qG
  • There is a dramatic departure between yield curve pricing for a recession and other measures of near-term growth; the Q2’20 Atlanta Fed GDPNow is extremely alarming.Get your market update from @CVecchioFX here: https://t.co/eMd3T8EwDO https://t.co/56oUP6we9U
  • The #DAX has now closed the gap from the beginning of March with the index breaking above 61.8% fib at 11592. Get your DAX market update from @JMcQueenFX here: https://t.co/wr67nkxc8z https://t.co/CkxPZn1v3t
Philippine Peso May Rise, USD Gains Could Slow It: ASEAN Weekly

Philippine Peso May Rise, USD Gains Could Slow It: ASEAN Weekly

2018-04-30 03:30:00
Daniel Dubrovsky, Analyst
Share:

To sign up for the ASEAN weekly outlook and stay updated on coverage for currencies like the Philippine Peso and Indonesia Rupiah, click here

ASEAN Outlook Talking Points:

  • Philippine Peso and Indonesian Rupiah were resilient last week despite US Dollar strength
  • US Dollar could appreciate on Fed’s preferred measure of inflation, FOMC and jobs data
  • USD/PHP may fall as Philippine CPI moves away from the central bank’s 2018 forecasts

Join our FOMC rate decision webinar and follow its impact on FX markets live!

Last Week’s Recap: Peso and Rupiah Resilient Despite USD Strength

ASEAN bloc currencies like the Singapore Dollar and Malaysian Ringgit succumbed to selling pressure against a stronger greenback last week. Firming hawkish Fed monetary policy expectations, as signaled by rising local government bond yields, likely drove this dynamic. It concluded with the first estimate of US first quarter GDP topping expectations. But not all currencies suffered from this region against the greenback.

The Philippine Peso gained as the PCOMP Index (Philippines Stock Exchange PSEi) rose to its highest since April 23rd. This followed news that S&P revised the country’s outlook to positive from stable. The Indonesian Rupiah also appreciated against its US counterpart by the end of last week. Bank of Indonesia stepped in to maintain Rupiah price stability after USD/IDR rose to its highest since early 2016. This also followed the central bank leaving rates unchanged in April for a seventh month in a row.

Week Ahead: More US Data, Indonesian and Philippine Inflation Reports Too

Similar to what we saw last week, ASEAN bloc currencies may be vulnerable to economic developments out of the world’s largest economy. There, throughout the week we will get the Fed’s preferred measure of inflation, the FOMC monetary policy announcement and a jobs report. Since the middle of this month, data out of the US has been increasingly outperforming relative to economists’ estimates. If this trend continues, then the greenback may continue putting pressure on its ASEAN counterparts.

Locally speaking, on Wednesday the Indonesian Rupiah will face its country’s inflation report. Indonesia’s headline CPI rate is expected to tick higher to +3.5% y/y from +3.4%. Such an outcome would put the pace of inflation directly in the middle of the central bank’s 3.5 ± 1 percent target. With that in mind, prospects of stable inflation may allow USD/IDR to focus on developments on the base currency side of things as mentioned earlier.

What could be more eventful is another inflation report out of the Philippines. On Friday, the country’s headline rate is estimated to jump to +4.5% y/y in April from +4.3% in March. This would mean the fastest pace of inflation since September 2011. In addition, this would continue bringing price growth further away from the upper boundary of the central bank’s inflation target (3.0 ± 1 percent). If this is indeed the reality, then USD/PHP could continue falling.

This is because Philippine’s central bank (Bangko Sentral ng Pilipinas, or BSP) noted in their most recent monetary policy announcement that they are closely watching price growth. The BSP lowered 2018 inflation projections to +3.9% y/y from 4.3%. Signs that prices are heading in the wrong direction of their estimates might spark some hawkish monetary policy expectations, boosting the Philippine Peso.

USD/PHP Technical Analysis: Ready to Keep Falling?

On a daily chart, USD/PHP has broken below a near-term rising trend line from mid-February. Leading into this break, the pair appeared to level off after ascending in a rising channel. From here, near-term support is the 38.2% Fibonacci retracement at 51.56 followed by the 50% midpoint at 51.20. On the other hand, near-term resistance is the 23.6% level at 51.99. A push above that exposes the 14.6% minor retracement at 52.26. There are warning signs though on the weekly chart that USD/PHP may continue falling.

Philippine Peso May Rise, USD Gains Could Slow It: ASEAN Weekly

On a weekly chart, the decline in USD/PHP has been accompanied with negative RSI divergence. This shows that momentum to the upside is slowing and could potentially lead to more declines down the road. In such an outcome, confirmation would still be ideal to argue that the dominant uptrend from the beginning of the year has indeed been reversed.

Philippine Peso May Rise, USD Gains Could Slow It: ASEAN Weekly

USD/PHP and other ASEAN Currencies Trading Resources:

--- Written by Daniel Dubrovsky, Junior Currency Analyst for DailyFX.com

To contact Daniel, use the comments section below or @ddubrovskyFX on

Twitter

To receive Daniel's analysis directly via email, please SIGN UP HERE

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.