Peso falls on reduced US growth outlook

MANILA, Philippines—The peso fell on Thursday following the move of the US Federal Reserve to slash its 2012 growth outlook for the world’s biggest economy.

The local currency closed at 42.425 against the US dollar, down by 29.5 centavos from the previous day’s finish of 42.13:$1.

Intraday high hit 42.15:$1, while intraday low settled at 42.44:$1. Volume of trade amounted to $941.1 million from $1 billion previously.

The drop of the peso, which led the drop in other Asian currencies, came after the release of a less favorable growth outlook for 2012 for the United States. The US Fed saw the US economy growing between 1.9 and 2.4 percent from the previous forecast of between 2.4 and 2.9 percent.

The US is one of the biggest export markets for many emerging economies including the Philippines. Its economic performance thus affects export earnings and overall economic growth of exporting countries.

The US Fed cut its growth forecast following less-than-expected employment generation and still sluggish consumer demand in the United States.