Peso falls over fears of worsening debt crisis in Greece

AFP PHOTO

MANILA, Philippines—The peso fell on Wednesday as new political problems in Greece led to speculations that debt crisis in the Euro zone may worsen.

The local currency closed at 42.41 against the US dollar, down by 13.5 centavos from the previous day’s finish of 42.275:$1.

Intraday high hit 42.35:$1, while intraday low settled at 42.44:$1. Volume of trade amounted to $1.096 billion from $655.7 million previously.

The depreciation of the peso, which came together with the decline of other Asian currencies, came following reports that the biggest political party in Greece failed to form a coalition, thereby increasing the chances of another elections in June.

The failure to form a coalition gave rise to speculations that the rival left-leaning party, which is seen to reject austerity measures and other conditions for Greece’s bailout, may eventually take over the Greek government.

Traders said the political turmoil in Greece has been aggravating the Euro zone’s debt situation, and has been causing fund owners to become risk-averse. In times of jitters, traders said, investors would hold on to the US dollar and liquefy assets purchased from emerging markets like the Philippines.

Due to sell-offs, the Philippine Stock Exchange Index fell by 27.27 points to 5,214.79.