MANILA, Philippines—The peso inched up in the first trading day of the week, moving together with other Asian currencies, as investors took note of speculations of further rise in interest rates in emerging Asia as well as favorable growth outlook for the region.
The local currency closed at 43.315 against the US dollar on Monday, up by 5.5 centavos from Friday’s finish of 43.37:$1.
Intraday high hit 43.25:$1, while intraday low settled at 43.33:$1. Volume of trade reached $582.5 million, down from $695.77 million previously.
Traders said expectations that central banks in the region would further increase interest rates have prompted some investors to shift funds to Asia to take advantage of a potential rise in yields.
The expectation of more interest rate hikes by Asian central banks comes amid accelerating inflation in the region, which is facing the challenges of rising demand and rising prices of oil imports.
The central bank of Thailand is set to decide on June 1 whether to raise or maintain its key policy rate, and traders said investors have been expecting the monetary authority to implement a hike.
The Philippines posted a 4.9 percent growth in the first quarter. This is a slowdown from 2010’s 7.6 percent, but traders said this was still an encouraging growth figure given the challenges confronting economies worldwide.