The Canadian Dollar is trading at 37.55 against the Philippine Peso this morning, up 0.23% with a YTD return of -3.27%. The open exchange rate for the pair was 37.50 when markets opened today, slightly better compared to their previous close of 37.46. CAD/PHP will have a daily range between 37.49 and 37.59, the 52-week range is anticipated to fluctuate between 34.89 and 39.52.
CAD/PHP has managed to keep a stable exchange rate after dropping to the 35.00 support level in March due to COVID-19. Since then the pair has stayed between 36.00 and 38.00, this is likely to attract bears moving into 2021 as there are hopes that with the release of coronavirus vaccinations and economic recovery, CAD/PHP will be able to slowly rise to the 42.00 level which was last seen in 2018.
Over the span of 2019 the loonie lost some momentum but managed to stay above the 38.00 level, traders anticipated more of a drop within the last year but PHP has managed to maintain strength due to declining imports. The currency has been one of the best performers in Southeast Asia, rising by 5.4% in 2020.
BNN Bloomberg reported that PHP “is seen notching the third year of gains in 2021 as the sluggish economic recovery curbs imports and with remittances expected to rebound.” As remittances are the nation’s biggest source of foreign exchange following exports, the Filipino central bank predicts that “remittances will advance 4% after an expected 2% drop in 2020.”
Analysts have stated that the peso won’t see much growth until Q2 next year, this slow recovery is due to the fact that “falling imports have crimped demand for dollars.” With its 18th month of declines, Philippine “imports fell 19.5% in October from a year ago”, making it likely that CAD/PHP will continue to follow bearish trends as 2021 approaches.
By Surina Nath