Peso rises on China plan to stimulate economy

AFP PHOTO/ROMEO GACAD

MANILA, Philippines—The peso inched up on the first trading day of the week as reports China may implement stimulus measures boosted appetite of investors for emerging-market securities.

The local currency closed at 41.86 against the US dollar, up by 12 centavos from Friday’s finish of 41.98:$1.

Intraday high hit 41.85:$1, while intraday low settled at 41.94:$1. Volume of trade amounted to $870.14 million from $1.018 billion previously.

The appreciation of the peso and other key Asian currencies came amid reports Chinese authorities may be considering measures to stimulate China’s economy after it slowed down in the second quarter.

Gross domestic product (GDP) of China grew by 7.6 percent in the second quarter from a year ago, the slowest pace in over three years.

The decelerated growth of China initially fueled concerns over a potential drag it would cause to other emerging economies such as the Philippines. China is one of the key export markets for goods produced by the Philippines and its neighbors.

Traders said, however, that reports that Chinese authorities have been mulling over measures to boost growth of China lifted sentiment even on other emerging Asian economies.

The slowdown of China was partly blamed on weaker demand for its exports as industrialized countries, led by the United States and those from the eurozone, remained confronted with anemic economic performance.