Peso seen bouncing back to 54:$1 this year

The peso is expected to sustain its momentum and appreciate further to the 54 to $1 level this year after ending a two-year slump amid the expected rate cuts by the US Federal Reserve and the Bangko Sentral ng Pilipinas (BSP).

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In its Asia FX Outlook 2024, ANZ Research said the peso may strengthen to 54.50 by the end of the year from the end-2023 level of 55.70 to $1.

ANZ Research said the local currency would likely face less headwinds from global financial market uncertainties this year.

“We forecast the peso-dollar rate will be at 54.50 by year-end 2024,” it said.

ANZ sees the peso strengthening to 55.20 by March and 55 by June before piercing the 54 to $1 level in September and 54.80 to 54.50 by December.

It expects the peso to further strengthen to the 53.50 to $1 level by the end of 2025.

As the dollar continues to weaken, ANZ said the peso would be driven by its current account dynamics and growth outlook.