Forex rate and foreign reserves level hit new highs

7 February 2007 – Foreign investments, overseas Filipino workers’ remittances, and exports continued to keep the peso-dollar rate strong. The domestic currency closed to a six-year high of P48.365 against the U.S. greenback at the Philippine Dealing System.

At the same time, the Bangko Sentral reported the country's gross international reserves reached an all-time high of US$23.8 billion as of end-January, after rising for fourteen consecutive months. The GIR includes part of the proceeds from the US$1.0 billion global bond issue of the national government. The foreign reserves level can finance 4.6 months' worth of imports of goods and payments of services and income.

Peso reaches five-month high

29 August 2006 – Overseas Filipino workers’ remittances and foreign investments into the stock market today pushed the peso-dollar rate to P51.04/US$, the peso’s strongest level against the U.S. dollar in five months, during intraday trading at the Philippine Dealing System.

The local currency closed at P51.05/US$ and averaged at P51.133/US$. The peso’s bullish prospects are also being fuelled by expectations of stable growth in the second quarter and a continued slowdown in inflation in August.

Peso plunges along with
regional currencies

16 May 2006 – Weak regional currencies, coupled with higher demand for the greenback from oil companies and other importers, sent the Philippine peso closing to a two-and-a-half-month low of P52.15/US$. In Asia, the rupiah sunk the most, depreciating by 3.9%.

China allowed the yuan to appreciate as the U.S. dollar sunk against the euro and the yen. Wall Street also declined for two-straight days, dragging along Asian equities markets and currencies. World oil and commodities markets also fell as investors sold U.S. assets. Markets have also been edgy over the U.S. Federal Reserve’s further moves on interest rates.

Peso depreciates to seven-week low
of P51.71/US$

21 April 2006 – The peso-dollar rate fell to a seven-week low of P51.71/US$ during today’s foreign currency trading at the Philippine Dealing System, but it closed at P51.69/US$, down from yesterday’s close of P51.495/US$.

Forex dealers are attributing the currency rate’s depreciation to the high dollar demand from oil-refining companies because of record-breaking prices of crude oil abroad, which even reached above US$75/US$ at the week’s close. Banks raised their demand for the U.S. greenback since the interest rate differential with foreign interest rates has narrowed with last Monday’s decline of the 91-day T-bill rate, the interest rate bellwether. Some dealers suspect the Bangko Sentral sold at least some US$20 million using conduit banks to avoid a sharp drop of the peso.

The currency market ignored encouraging fiscal data in the first quarter—the lower-than-expected fiscal deficit and higher revenue collections by the Bureau of Internal Revenue and the Bureau of Customs.

91-day T-bill rate drops to 4-year low

17 April 2006 – The 91-day Treasury bill rate, the interest rate bellwether, fell to a four-year low of 4.60% today from 4.933% the previous week. National Treasurer Omar Cruz attributed the drop to “excess liquidity in the market and limited supply of government securities.” Yields for the 182-day T-bill and 364-day T-bill also dropped to 5.499% and 6.09%, respectively, from 5.741% and 6.49%. Total tenders for the government’s P3.0 billion offering reached P17.3 billion.