Peso gains most since June as geopolitical tension eases

Categories: Business Updates

Date Posted: 11 Aug 2014

The Philippine peso rose the most in seven weeks as an easing of geopolitical tension revived demand for emerging-market assets.

Israel and militants in the Gaza Strip agreed to an Egyptian proposal for a 72-hour truce, while Russian Foreign Minister Sergei Lavrov told reporters on August 10 that a cease- fire in Ukraine is possible. Philippine exports rose 10.8 percent in June from a year earlier, the most in three months, according to a Bloomberg survey before a report due on Tuesday.

The peso strengthened 0.5 percent, the most since June 19, to 43.908 per dollar as of 10:47 a.m. in Manila, prices from Tullett Prebon Plc. show. The currency fell 1.3 percent in the last three days and touched 44.278 on August 8, the weakest level since May 8.

“Risks have eased since late last Friday,” said Joey Cuyegkeng, an economist at ING Groep NV in Manila. “The weakness last week was also overdone, although there was also corporate demand for the US dollar.”

Money sent home by Filipinos working overseas increased 5.2 percent in June from a year earlier, compared with 5.4 percent the previous month, according to a Bloomberg survey before data due on August 15.

One-month implied volatility, a measure of expected moves in the exchange rate used to price options, fell one basis point, or 0.01 percentage point, to 5.83 percent.

The yield on 3.5-percent government bonds due in March 2021 slipped one basis points to 3.74 percent, prices from Tradition Financial Services showed.
Written by: Bloomberg News

Source: http://businessmirror.com.ph/index.php/en/news/top-news/36980-peso-gains-most-since-june-as-geopolitical-tension-eases

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