Peso recovers after China offer of bailout funds for Euro zone

The peso recovered together with other key Asian currencies after foreign exchange markets were calmed by the statement of China that it would help resolve the Euro debt crisis calmed foreign exchange markets.

The local currency closed at 42.64 against the US dollar, up by 11 centavos from the previous day’s finish of 42.75:$1.

Intraday high hit 42.6:$1, while intraday low settled at 42.92:$1. Volume of trade amounted to $1.33 billion from $1.25 billion previously.

The appreciation of the peso came following a statement from People’s Bank of China Governor Zhou Xiaochuan that China, with over $3 trillion in foreign exchange reserves, would like to participate in efforts to help rescue debt-ridden countries in the Euro zone.

The head of the China’s central bank said the country would contribute to bailout funds necessary to avoid spillovers of the debt crisis in the Euro zone.

Traders said the statement from China helped allay concerns of a potential worsening of the Euro zone debt crisis, which many believe would take time before getting fully resolved.