Peso rises on news of US improved home sales, prices

AFP FILE PHOTO

MANILA, Philippines—The peso strengthened on Wednesday as indicators of a potentially improving demand in the United States coupled with favorable economic indicators in the Philippines boosted demand for peso-denominated stocks.

The local currency closed at 42.37 against the US dollar on Wednesday, up by 10 centavos from 42.47:$1 on Tuesday.

Intraday high hit 42.30:$1, while intraday low settled at 42.42:$1. Volume of trade amounted to $721.81 million from $832.41 million previously.

Traders said the rise of the peso, together with other key Asian currencies, came amid few indicators that may be showing improving US demand. These indicators include rise in US home sales in May and a slowdown in the drop in property prices in the world’s biggest economy.

Traders said the US indicators gave hope the global economy would improve as well. The United States is a key export market and a source of investments for many emerging economies like the Philippines.

Market players also said favorable macroeconomic fundamentals in the Philippines make yield-seeking investors opt for peso-denominated stocks and other securities.

The rise of the peso on Wednesday came with the increase in the Philippine Stock Exchange Index (PSEi) by 64.08 points to 5,257.92.