Peso falls as PH neighbors, China slow down

AFP FILE PHOTO

MANILA, Philippines—The peso fell again on Tuesday as indications of a slowdown in neighboring countries affected outlook on the Philippines.

The local currency closed at 41.75 against the US dollar, down by 14 centavos from Monday’s finish of 41.61:$1.

Intraday high hit 41.67:$1, while intraday low settled at 41.78:$1.

Volume of trade reached $884.6 million from $700.58 million previously.

The depreciation of the peso against the US dollar came following reports that exports by Singapore and department-store sales in South Korea fell in August. The concerns over these reports added to those over the slowdown of China, a key export market for many neighboring economies.

Traders said the unfavorable economic data for neighboring countries substantiated views that the effects of the prolonged crisis in the eurozone and the lackluster performance of the US economy have been spilling over to Asia.

Traders said the Philippines might not be totally immune from what has been happening outside even if it has posted above-target growth of 6.1 percent in the first half.

The expected impact on the Philippines, which would still grow by a decent pace in 2012, somewhat dampened appetite for peso-denominated securities, traders said.

The drop in the peso came with the decline in the Philippine Stock Exchange Index, which closed at 5,331.13 on Tuesday, down by 0.37 percent from the previous.