MANILA, Philippines?The peso closed stronger Friday, quickly recovering from the fall seen the previous day and reinforcing projections that the local currency will relatively be strong in 2010 amid improved investor sentiment.

The local currency ended the day's trading at 45.66 against the US dollar, up 6 centavos from 45.72 on Thursday.

Intraday high was recorded at 45.6, while intraday low stood at 45.73. Meanwhile, volume of trade reached $522.5 million, down 14 percent from the previous day's $609.96 million.

Traders said the peso is benefiting from a generally positive outlook for developing Asian economies at the back of encouraging macroeconomic figures, including relatively moderate inflation rates and faster economic growth rates.

The optimism is being translated into higher foreign capital inflows, such as in the form of investments in stock, currency and bond markets, and direct investments.

In the case of the Philippines, the government's economic and inflation targets are well within reach, according to economic managers.

BSP Governor Amando Tetangco Jr. said that so far, indicators point to an inflation rate that will settle within the 3.5- to 5.5-percent ceiling set by the monetary authority for the year. This is faster than last year's 3.2 percent, but is nonetheless a tolerable increase in consumer prices.

He said that the GDP growth target for this year of between 2.6 and 3.6 percent, faster than last year's 0.9 percent, is also attainable.. "The outlook for inflation and economic growth remains favorable," Tetangco said in a speech during the annual convention of the Chamber of Thrift Banks held Friday at Dusit Thani Hotel in Makati City.