Various peso notes are displayed at a bank in Manila on December 16, 2011. AFP PHOTO/TED ALJIBE
MANILA, Philippines—The peso strengthened on the last trading day of the year amid hopes that the country would manage to post a decent growth rate in 2012 even amid the lingering crisis in the Euro zone.
The local currency closed at 43.84 against the US dollar on Thursday, up by 13 centavos from the previous day’s finish of 43.97:$1.
Intraday high hit 43.80:$1, while intraday low settled at 44.13:$1.
Volume of trade was thin at only $254.53 million, versus $265.78 million previously, as some market players were already in vacation mode.
Traders said the market consensus pointed towards the debt crisis in the Euro zone persisting, if not worsening, throughout 2012, thus causing some risk aversion among investors.
Nonetheless, projections that emerging markets like the Philippines will manage to grow next year, albeit at less-than-desired paces, give reason for yield-seeking investors to purchase emerging-market assets.
The appreciation of the peso came following reports that Philippine imports grew in October. A rise in imports, especially of raw materials and intermediate goods, is perceived as a signal that manufacturers expect increase in demand for their products in the months ahead.
The National Statistics Office has reported that imports grew by 2.3 percent to $5 billion in October 2011 from $4.9 billion in the same month in 2010.