Peso surges to 4-1/2 year high

MANILA – The peso climbed to a four-and-a half-year high, closing Tuesday at 41.33 against the US dollar amid strong appetite for risk among investors.

At the Philippine Dealing System, the local currency opened at 41.43 and traded to a high of 41.33 vis-à-vis the greenback, or 12.5 centavos stronger than the 41.455 finish on Monday. Trading volume jumped to $1.021 billion from the previous $687.95 million.

Currency traders said this was the highest close in four and a half years. On September 17, the peso tested the 41.33-to-a-dollar level during intraday trading before pulling back.

Markets around the region also rose on Tuesday, buoyed by US retail sales, which unexpectedly rose 1.1 percent in September.

A currency trader said risk appetite has gone up because of the positive outlook on the EU, with indications that Spain will finally avail of a bailout package.

The trader said the next support level is at P41.20:$1, adding that the exchange rate may soon reach the P41:$1 level barring any bad news in the coming days. –Likha Cuevas-Miel, InterAksyon.com