Philippine Peso Retreats From 2008 High as Importers Buy Dollars
The Philippine peso retreated from a four-year high on speculation importers stepped up dollar purchases to take advantage of a more favorable exchange rate.
The currency fell 0.4 percent to 41.32 per dollar as of 4:25 p.m. in Manila, according to Tullett Prebon Plc. It touched 41.120, the strongest level since March 2008. The peso gained 6.1 percent this year, the second-best performance among the 11 most-active Asian currencies, as foreign funds bought $1.9 billion more local shares than they sold, exchange data show.
“The 41 to 41.20 range appears to be a support level” for the dollar versus the peso, said Jonathan Ravelas, chief market strategist at Manila-based BDO Unibank Inc. (BDO) “This level is a sweet spot for importers.”
One-month implied volatility for the peso, a measure of exchange-rate swings used to price options, rose 15 basis points to 5.25 percent. A support is a level on a price chart that analysts predict will act as a floor in a declining market.
The yield on the government’s 8 percent bonds due July 2031 fell two basis points, or 0.02 percentage point, to 5.66 percent, according to prices from Tradition Financial Services.
The Philippines plans to increase sales of government debt in the local market this year by 9 percent to 585.1 billion pesos ($14.2 billion), according to a funding plan obtained from the Department of Finance.
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