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By Maricel E. Burgonio, Reporter
THERE was no let up in the
peso’s appreciation, as the local currency rose to a fresh
six-year high on Wednesday as investors bet on the Bangko Sentral ng
Pilipinas (BSP) keeping its interest rates steady during a meeting
today.
At the Philippine Dealing System,
the peso closed stronger at 47.61 to the dollar, up from Tuesday’s
closing price of 47.71. The local currency climbed to as high as
47.61 during intraday trading before shedding 10 centavos by day’s
end. Total volume turnover remained high at $417 million.
“The market is expecting BSP to
maintain its rates in tomorrow’s policy meeting, which is good for
investor interest,” a trader said, adding a cut in interest rates
would mean lower income for investors.
The BSP’s overnight borrowing
rate stood at 7.5 percent, while its overnight lending rate remained
at 9.75 percent. The Monetary Board will meet today to decide on
whether to maintain these rates.
“The US dollar is weak compared
to other currencies such as Sterling [which] reached [a] 16-year
high and euro [which rose to an] all-time high,” a trader said.
Traders said the peso is seen to
rise this month to 47.50 to the dollar, its strongest yet in six
years since March 2001. The local currency is further seen to hit a
seven-year high of 46.50 during the peak of remittance season next
month.
Despite the peso’s strength,
the upcoming election may lead some investors to lock in profits
should some unexpected bad developments occur, Metropolitan Bank
& Trust Co. said in a commentary.
“The BSP has been siphoning all
of the excess US dollars in the system and has been able to contain
a rapid peso appreciation,” it said.
The central bank’s intervention
is widely viewed as an attempt to prevent huge dollar inflows from
stoking inflation.
In a report, the United Nations
Economic and Social Commission for Asia and the Pacific (Unescap),
however, said that prices in the Philippines would ease further this
year owing to tight monetary policies and reduced oil prices.
Unescap projected a 4.5-percent
rise in prices this year, which is within the BSP forecast of
between 4 percent and 5 percent.
--With Darwin G. Amojelar
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