THE PESO could continue its climb this week and return to the P56-per-dollar level, with the US Federal Reserve on wait-and-see mode as it awaits clarity on the Trump administration’s policies.

The local unit closed at P57.206 per dollar on Friday, strengthening by 11.4 centavos from its P57.32 finish on Thursday, Bankers Association of the Philippines data showed.

This was the peso’s best finish in nearly five months or since its P57.205-a-dollar close on Oct. 11, 2024.

Week on week, the peso jumped by 78.9 centavos from its P57.995 finish on Feb. 28.

The peso rose on Friday as most currencies rose against the dollar after the Trump administration delayed the planned tariffs against some Canadian and Mexican imports, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

“The dollar-peso traded lower on growing bets that the Fed will cut rates in June and after improving sentiment after President Donald J. Trump delayed the tariff on certain goods from Mexico and Canada, improving risk-off sentiment,” a trader said in a phone interview on Friday.

The US dollar wallowed near a four-month low in the Asian session Friday as ever-shifting tariff policies fanned uncertainty and increased concern about growth prospects for the world’s largest economy, leaving investors grasping for jobs data due later in the day, Reuters reported.

Another reprieve of levies aimed at Mexico and Canada announced by Mr. Trump on Thursday offered little relief, keeping the safe-haven yen not far off its strongest against the greenback since early October.

The reprieve expires on April 2 when Mr. Trump said he will impose reciprocal tariffs on all US trading partners.

The US dollar index, which measures the greenback against six major rivals, fell 0.05% to 104.15.

For this week, the trader said the peso’s movement against the dollar will depend on the US nonfarm payrolls data released after the market’s close on Friday.

“If employment is weak and unemployment is higher, the dollar will be weaker. But if there is a surprise uptick, this will be supportive of the dollar,” the trader said.

The trader sees the peso moving between P56.80 and P57.30 per dollar this week, while Mr. Ricafort expects it to range from P56.90 to P57.40.

US job growth picked up in February, but cracks are emerging in the once-resilient labor market amid a chaotic trade policy and deep federal government spending cuts that threaten to disrupt economic growth this year, Reuters reported.

The Labor department’s closely watched employment report on Friday, the first under Mr. Trump’s watch, showed a broader measure of unemployment surging to near a 3-1/2-year high last month as the ranks of part-time workers swelled.

The share of workers holding multiple jobs was the highest since the Great Recession. Economists said the Trump administration’s whiplash trade policy was making it difficult for businesses to plan ahead.

Business sentiment has plunged since January, erasing all the gains notched in the aftermath of Trump’s election victory in November. The stock market has sold off.

Nonfarm payrolls increased by 151,000 jobs last month after rising by a downwardly revised 125,000 in January, the Labor department’s Bureau of Labor Statistics said.

Economists polled by Reuters had forecast payrolls advancing by 160,000 jobs after a previously reported 143,000 gain in January. The survey of establishments showed job growth averaged 138,000 per month so far this year compared to 209,000 in the fourth quarter.

The Federal Reserve is expected to keep its benchmark overnight interest rate unchanged in the 4.25%-4.5% range this month as policy makers continue to monitor the economic impact of tariffs and an immigration crackdown.

Financial markets expect the US central bank to resume rate cuts in June, though much would depend on inflation.

The Fed paused rate cuts in January, having reduced the policy rate by 100 basis points since September, when it embarked on its easing cycle. The policy rate was hiked by 5.25 percentage points in 2022 and 2023 to tame inflation.

Fed Chair Jerome H. Powell said on Friday “we do not need to be in a hurry, and are well positioned to wait for greater clarity.”

Stocks on Wall Street edged higher after Mr. Powell’s comments. The dollar was lower against a basket of currencies. US Treasury yields rose. — A.M.C. Sy with Reuters