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'Peso is just fine': Espenilla

Bangko Sentral ng Pilipinas (BSP) Governor Nestor A. Espenilla Jr. said the peso “is just fine” amid its recent weakness and stressed that the currency’s performance only reflected current market environment.

After Thursday’s morning session, the peso registered an average trading level against the US dollar of 51.44, slightly weaker than 51.38 average same period in the previous day.

On Wednesday, the peso closed at 51.34 to a dollar.

“There will be volatility, runs and corrections, and the public should plan accordingly and factor in exchange risk in their decisions,” the central bank chief told reporters in a message Thursday.

Espenilla, however, pointed out that the local currency “is not expected to meltdown because the underlying economic fundamentals of the economy are healthy.”

He said deficit in the country’s balance of payment (BOP), which amounted to USD863 million in end-2017, “is very manageable”.

He said the deficit “ was but a reflection of an economy that’s growing rapidly in a way that was sustainable.”

“We are very far from any foreign exchange crisis given our large GIR (Gross International Reserve) buffer and secondary buffers as well as investment grade-rating that guarantees ready market access for any official and commercial financing requirement,” he added.

BSP data show that as of end-2017, the country’s total dollar reserves reached USD81.47 billion, higher than year-ago’s USD80.69 billion.

This level is enough to cover 8.3 months’ worth of imports of goods and payments of services and primary income.

Philippine monetary officials said the standard GIR level to be considered healthy was enough to cover three months requirements of an economy.

Joann Villanueva / PNA