Peso rises on news of Japan’s bond purchasesBy Michelle V. Remo
Philippine Daily Inquirer
The local currency closed at 40.635 against the US dollar, up by 3.5 centavos from the previous day’s finish of 40.67:$1.
Intraday high hit 40.60:$1, while intraday low settled at 40.645:$1.
Volume of trade reached $709.8 million from $715.2 million previously.
The appreciation of the peso, which came with the rise of other key Asian currencies, came as investors expected significant liquidity to flow to emerging markets over the short term.
Traders said such an expectation has been partly anchored on the plan of the Bank of Japan to boost the Japanese economy through bond purchases. Portions of the additional liquidity resulting from the asset purchases are expected to go to emerging markets like the Philippines in the form of investments in securities.
In its latest policy meeting, the Japanese central bank decided to push through with its asset purchase program to start in 2014.
Efforts to stimulate the Japanese economy, a key export market for goods coming from the Philippines and its neighbors, are seen to benefit economies of exporting countries as well.