The Bangko Sentral ng Pilipinas (BSP) assured its presence in the market as anticipation to the possible tapering of the United Stated Federal Reserve’s quantitative easing program affects the peso.
“As we understand it, the peso weakness over the past couple of days is partly due to real demand for specific import requirements and partly due to some portfolio adjustment of funds in reaction to Fed tapering concerns,” BSP Governor Amando Tetangco Jr., said in a text message.
The Philippine peso slightly improved on Wednesday as it closed to P44.12 to a dollar, appreciating 17 cents from P44.29 close on Tuesday.
Tuesday’s close was the lowest level of peso since September 6.
“We are closely monitoring developments, and, as is our policy, will maintain a strategic presence in the market, as needed to curb excessive volatility in foreign exchange rate movements,” Tetangco said.
The local currency broke the P44 to a dollar level on December 9, as analysts pointed out that the positive United States employment data strengthened the dollar.
Last week, the US Labor Department reported that the world’s largest economy created 203,000 jobs in November. US unemployment rate recorded a five-year low of 7 percent from 7.3 percent in October.
This development in the US economy boosted the chances of an early pullback on the US Federal Reserve’s $85-billion a month stimulus program for Asian markets.