Peso gained 4.33% vs dollar in first 6 months
The peso appreciated the most against the dollar in the first half compared with other key currencies in the region in what the central bank credited to the Philippines’ favorable economic performance.
Governor Amando Tetangco Jr. of the Bangko Sentral ng Pilipinas said this development reflected how fund owners favored peso-denominated assets even as prospects for the global economy remained uncertain.
Documents from the BSP showed that the peso appreciated by 4.33 percent against the greenback since the start of the year to July 2, the strongest movement during the period among a basket of major currencies in Asia and the Pacific.
“The peso appreciation has reflected the positive development in the Philippine economy, particularly the improved fiscal position [of the national government] as well as the external liquidity of the economy,” Tetangco said.
In the same period, the Malaysian ringgit appreciated by 0.4 percent against the dollar, the Thailand baht by 0.44 percent, the Australian dollar by 1.42 percent, the Singapore dollar by 2.7 percent and the New Zealand dollar by 4.18 percent.
The yen depreciated against the dollar by 2.44 percent, the Indonesian rupiah by 2.82 percent and the Indian rupee by 4.34 percent.
The Philippines’ declining debt burden—outstanding debts as a proportion of the country’s gross domestic product—has indicated the state’s improving ability to service its liabilities to creditors and bond investors, Tetangco said.
He said the country’s comfortable external liquidity, measured by its reserves of foreign currencies, indicated that government and private-sector borrowers from the Philippines were capable of servicing their debts to foreign creditors and bond holders.
“Our economic indicators will continue to provide fundamental support to the peso,” Tetangco said. He said there was a likelihood the peso would remain relatively strong throughout the year as investors respond to the country’s favorable economic fundamentals.
