Peso bounces back

AFP PHOTO

MANILA, Philippines—The peso on Thursday hit a five-week low before edging up stronger than the previous day as investors weighed domestic and external factors affecting risk appetite.

The local currency closed at 41.125 against the US dollar, up by 3.5 centavos from the previous day’s finish of 41.16:$1.

Intraday high hit 41.20:$1, while intraday low settled at 41.26:$1, which traders said was weakest in five weeks.

Volume of trade reached $750.1 million from $344.9 million preciously.

Traders said the move of the BSP to impose a cap on banks’ holdings of non-deliverable forwards (NDFs) prompted some fund owners to shift to the dollar.

However, they also said reports that US policymakers would soon resume talks on the US government’s fiscal problem lifted hopes that the world’s biggest economy could prevent a worsening of its fiscal situation.

These hopes somewhat influenced a better outlook on the global economy, and thus risk appetite, traders said.