The country’s big banks can withstand shocks, such as a rise in loan defaults, should global economic problems spill over to the Philippines, as the level of their capital continues to exceed domestic regulatory requirements and international standards.
The peso inched up on Thursday amid indicators global demand could be picking up, such as favorable growth of South Korea in the first quarter and manageable uptick in oil prices.
The peso inched up on Wednesday as reports of an increase in sales of residential properties and corporate earnings in the United States boosted sentiment of investors on the global economy.
The effects of the $85 billion in US government spending cuts scheduled to begin Friday will be felt across oceans and could further hurt recession-hit European nations and burden an economically slowing China, shrinking the market for countries that depend on selling things to the United States.
The world economy faces a new threat. Instead of a banking collapse or too much debt, fears are growing that countries are using their currencies as an economic weapon.
The peso moved sideways on the first trading day of the week as investments by local firms are seen to grow further and as fund owners looked for more signals to cement hopes that the global economy will post a more significant recovery this year.
The peso rose on Wednesday as investors manifested risk appetite anew on the back of expectations of growing global liquidity.
WHILE the global economy struggled through 2012 due to the prolonged crisis in the euro zone and the fiscal problems of the United States, the Philippines appeared like it just came from a refreshing walk in the park.
Investment professionals across the globe are optimistic about global growth prospects for 2013, but they believe much work needs to be done to restore financial market integrity.
Global growth is set for a sharp slowdown next year and the eurozone debt crisis “remains the greatest threat to the world economy at present,” the OECD warned on Tuesday.
The Philippines is a “hugely exciting” market where the United Kingdom is keen on boosting reciprocal investment.
The peso rose to its highest in more than four years on Wednesday as the market reacted positively to the reelection of US President Barack Obama, a development seen to allow the world’s biggest economy to pursue his administration’s reforms aimed at a more substantial recovery.
