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Tuesday, March 15, 2005
Peso hits 53.86 level vs. dollar; volume up
A resurgent peso yesterday breached the psychological 54 to the US dollar level to trade at an intra-day high of 53.86.
According to the Bankers Association of the Philippines, the peso traded at 53.86 to 54.03, eventually closing at 53.97 on high volume of $416 million.
On the sidelines of the Philippines Investment Conference last Thursday, He said other banks were even thinking the peso will hit 50 to the greenback.
Tetangco made the remarks after the peso hit 19-month highs last week.
“The peso is being buoyed by expectations of inflows for the IPOs (initial public offerings) due this month,” he said in a press conference at Casino Bangko Sentral ng Pilipinas Deputy Gov. Amando Tetangco Jr. said if government reforms continued, “it’s possible to hit the 52 level this year.”
Español de Cebu.
The weak dollar and the strength of the regional currencies were also boosting the local currency, he added.
SM Investments Corp.’s IPO, which started last week, involves the sale of 115 million shares at P250 each, making it the biggest in the Philippine Stock Exchange’s 70-year history, with estimated proceeds of P28.75 billion.
Earlier, Ayala-controlled utility Manila Water Co. offered its shares to the public. According to reports, it will list 745.33 million common shares this Friday.
Tetangco said the change in sentiment towards the Philippines occurred after the Supreme Court ruled in favor of the Mining Act, the economy did well in 2004, and government passed reform measures.
The government has been passing tax measures to raise revenues so it can avoid borrowing from outside sources to finance its expenses.
Finance Secretary Cesar Purisima said he is not even thinking about borrowing money until April.
“I’m not going to think about it until April,” he said at the investment conference site at Shangri-la’s Mactan Island Resort. “We have too much cash.”
He is waiting until April, because he would first like to see “where we are in the VAT measure,” as this will affect the country’s borrowing costs.
Congress is now deliberating on measures to increase the value-added tax rate or at least lift the VAT exemptions on certain individuals. (CTL)
(March 15, 2005 issue)
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