Philippine Peso Rises Most This Month After Break; Bonds Decline

The Philippine peso climbed the most this month after Germany signaled it may consider relaxing conditions on aid to Greece, boosting demand for emerging-market assets.

The currency rebounded from its worst week since May as central bank data showed Philippine balance of payments surplus surged to $3.18 billion last month from $14 million in June. Greek Prime Minister Antonis Samaras, whose government favors an extension of its fiscal adjustment program by two years, travels to Berlin and Paris on Aug. 24 and 25. Financial markets in the Philippines were shut on Aug. 20 and Aug. 21 for Eid holidays.

“So far news from Europe is supportive of Asian currencies such as the peso,” said Jonathan Ravelas, chief market strategist at Manila-based BDO Unibank Inc. “Demand for the peso is also stronger today because of the bunching up of overseas remittances following the two-day holiday.”

The peso climbed 0.3 percent to 42.29 per dollar as of 4:37 p.m in Manila, Tullett Prebon Plc prices showed. That’s the biggest gain since July 31. One-month implied volatility, a measure of exchange-rate swings used to price options, was little changed at 6.30 percent.

Bonds declined with the yield on the 7.375 percent debt due March 2021 rising five basis points, or 0.05 percentage point, to 5 percent, according to Tradition Financial Services.

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