MANILA, Philippines—The peso fell further on Tuesday as lingering concerns over the situation in Japan sustained a cautious outlook on the economy in the region.
The local currency closed at 43.18 against the US dollar on the second trading day of the week, down by 10 centavos from the previous day’s finish of 43.08:$1.
Intraday high hit 43.15:$1, while intraday low settled at 43.35:$1. Volume of trade inched up to $1.045 billion, substantially rising from $451.25 million the previous day.
Traders said the depreciation of the peso came together with the decline of other major Asian currencies against the greenback. Investors shifted their funds to perceivable safer instruments, particularly those denominated in US dollars, as the economic risk from the disaster in Japan brought a less favorable outlook on the performance of Asian developing countries, including the Philippines.
The decline of the peso and other Asian currencies came amid reports that Japanese authorities admitted heightened radiation risk from the Fukushima Dai-Ichi nuclear power plant and as Japan continued to suffer from aftershocks following the killer quake last month.
Traders said the disaster in Japan would dampen its economy, and thus drag economies of neighbors too. This is because Japan serves as a major export market for many developing Asian economies including the Philippines and is a major provider of official development assistance.