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CVPositive, negative effects of strong peso on Philippine economy | |

English.news.cn 2011-07-28 10:32:15 | FeedbackPrintRSS | by Alito L. Malinao
MANILA, July 28 (Xinhua) -- The appreciation of the Philippine peso to its highest level in three years has both good and bad effects on the country's economy.
Certainly, as some economists have pointed out, a strong peso is a clear indication that investors' confidence, particularly from foreign sources, have returned to the Philippines.
According to the Bangko Sentral ng Pilipinas (BSP), the country 's central bank, the strong performance of the Philippine peso was a direct result of the influx of foreign portfolio investment in emerging economies like the Philippines.
BSP Deputy Governor Diwa Guinigundo said that foreign portfolio managers have preferred investing in Asia given the uncertainties and challenges confronting the United States and some European countries saddled by mounting debts.
"Advanced economies appear to be moving backward.. Any logical direction of investment inflows is toward the more robust and promising emerging markets," Guinigundo said during the launching on Tuesday of the latest World Investment Report by the United Nations Conference on Trade and Development (UNCTAD).
Foreign portfolio investment yielded a net inflow of 138.68 million U.S. dollars as of June 17 compared to a net inflow of only $2.40 million for the same period in 2010.
In Tuesday's trading, the Philippine peso closed at 42.225 against 1 U.S. dollar, up by 16.5 centavos from Monday's finish of 42.39: 1 dollar.
On Wednesday, the peso peaked to 42.11 to 1 U.S. dollar, the highest so far since May 2008.
Guinigundo said that besides the faster economic growth rates in the region, higher interest rates in Asia also helped entice foreign portfolio investors to put their investment here.
Interest rates in emerging Asia are rising while those in the West, led by the United States, are still at record lows.
During the past two years, the Philippine peso has been one of the strongest currencies in Southeast Asia.
Aside from the inflow of portfolio and foreign direct investments, the rise in the peso was also caused by increased dollar remittances from overseas Filipino workers (OFWs) and the deterioration of the U.S. economy, the Philippines' number one trading partner.
According to Sen. Ralph Recto, chairman of the Senate committee on ways and means, the peso could even appreciate up to 34 pesos to 1 U.S. dollar this year.
A situation like this would put the Philippine government in a quandary. Peso appreciation would mean a reduction of the country' s debt servicing as well as reduction of prices of imported commodities.
However, this appreciation will also reduce the purchasing power of the dollars that OFWs send to their families in the Philippines. It would also mean that Philippine exports would be less competitive abroad and the income of exporters would be diminished.
Already, exporters from all over the country have cautioned about the implications of a strong peso on the export industry.
An earlier report by the state-run Philippines News Agency quoted Roberto C. Amores, president of the Philippine Food Exporters and Processors Organization (PHILFOODEX), as saying that a strong peso is "bad for the exporters and bad for domestic manufacturers."
"Definitely, we will again lose competitiveness vis-a-vis our Asian neighbors. This will cause massive unemployment, factory shutdown and serious displacement as cheaper imports flood the local market," Amores said.
Amores also said that portfolio investment is not a reliable gauge of economic growth of the country because it can be withdrawn from the market anytime.
Earlier, President Aquino has announced the release of 100 million pesos (2.36 million U.S. dollars) in export support fund ( ESF) to help the export industry cope with various pressures like the strong peso.
Philexport President Sergio Ortiz-Luis has said that in spite of the decline in May exports, they are not changing their export target growth of 10 percent for 2011, adding that they "expect higher figures starting the third quarter."
But in an earlier briefing, Ortiz-Luis also bewailed the government's peso-dollar exchange rate policy. "A major stumbling block in sustaining export growth is an exchange rate policy that has always been biased in favor of a strong peso," Ortiz-Luis said.

Philippine Q4 GDP surprises, strong peso causes anxiety by Karen Lema, Reuters
Posted at 01/31/2013 11:35 AM | Updated as of 01/31/2013 1:20 PM
MANILA (UPDATE) - The Philippine economy grew faster than expected in the last quarter of 2012 on robust domestic demand, bolstering expectations that the country's key policy interest rate will stay at a record low in the early part of the year.
The central bank said that strong economic growth supported the view the domestic economy needed "very little support" via monetary policy to sustain its momentum.
But Manila is concerned about the impact of a strong peso, particularly on the competitiveness of its exports and the growing outsourcing sector, as well as on remittances of overseas Filipinos that fuel domestic consumption.
Gross domestic product rose 1.5 percent in the December quarter from the previous three months, compared with a market forecast of 0.6 percent and after revised 1.7 growth in the third quarter.
Increases in private and public spending helped offset sluggish demand for exports, keeping the Philippines, like many of its neighbors in Southeast Asia, resilient in 2012 despite global headwinds.
"It is our immediate task to put in place policies and implement programs that will sustain our economy's growth over the medium term," Arsenio Balisacan, economic planning secretary, told reporters. The government will continue to work on transforming the economy to one that is more industry and investment driven, he added.
Balisacan also said economic managers were discussing ways to address the impact of a strong peso on the economy. But he said there was no need to resort to drastic measures such as capital controls with the absence of major currency swings.
The peso has risen more than 1 percent against the dollar so far this year after surging nearly 7 percent in 2012.
From a year earlier, the economy rose a faster-than-expected 6.8 percent and against revised 7.2 percent annual growth in the September quarter, the economic planning agency said.
For the full year 2012, the economy grew 6.6 percent, surpassing the government's 5-6 percent forecast and market expectations of 6.4 percent. After China, the Philippines has reported the fastest growth in 2012 so far.
Government expenditure jumped nearly 12 percent in 2012 while private spending, boosted by remittances from Filipinos working overseas, was up 6.1 percent.

MOMENTUM TO SUSTAIN
The government expects the Philippines' growth momentum to be sustained this year as the government pursues investment in infrastructure through public-private partnerships.
"The pace of Philippine growth has consistently surprised on the upside in the past year as the economy displays resilience against global headwinds and driven primarily by domestic engines," said Radhika Rao, economist at Forecast PTE in Singapore.
"However, one cannot downplay the need for domestic investments, public and private sector, to translate the cyclical upturn into a more structural-driven recovery," she said.
Robust growth may push up inflation later, although any rate increase will not come soon because of strong capital inflows, said Enrico Tanuwidjaja, economist at RBS in Singapore.
Diwa Guinigundo, central bank deputy governor, said the economy was beginning to show dividends from various policies put in place. That includes rate cuts totaling one percentage point last year.
The International Monetary Fund has raised its 2013 economic growth forecast for the Philippines to 6 percent, and it expects the economy to grow at a healthy pace of 5.5 percent in 2014.
With the positive growth outlook, the majority of economists in a Reuters quarterly poll released this month expect the central bank to keep interest rates steady until the third quarter of the year.
Economists in the same poll estimate 2013 growth will slow to 5.6 percent. While the forecast is below the government's 6 to 7 percent target this year, it is higher than the growth estimates for Malaysia, Thailand, Vietnam and Singapore.
The central bank has trimmed its forecast for average inflation in 2013 to 3.0 percent from 3.1 percent but raised its 2014 forecast to 3.2 percent from 2.9 percent.
-------------------------------------------------
Philippine peso ends 2012 at P41.05, up 6.5%
BY CAI ORDINARIO
POSTED ON 12/27/2012 7:35 PM | UPDATED 12/29/2012 3:23 AM
STRONGER PESO. The local currency has been appreciating against the dollar. Graph shows average monthly exchange rate from Bangko Sentral ng Pilipinas and PDEX.
MANILA, Philippines - The Philippine peso, the best-performing Southeast Asian currency in 2012, settled at P41.05 against the dollar on the last day of trading in 2012.
This made the currency 6.53% stronger than the P43.919 it started trading at on January 2. This also brought the average exchange rate to around P42.228 for the entire year and posted the the biggest annual gain since a 19% appreciation in 2007.
The strongest close of the peso for the year was on December 8 at 40.862 while the weakest was on January 2 and January 17 at P43.919.
While little changed from a week ago, the local currency had a boost from the Philippines' phenomenal growth of 7.1% in the 3rd quarter -- the fastest in Southeast Asia -- as well as expectations that the Phlippines is on track to winning its first investment-grade rating.
However, the stronger peso has been a bane to the following sectors: * Overseas Filipino workers (OFW)
With the strong peso, the purchasing power of the funds that OFW send to their loved ones in the Philppines are diminished. This is because the dollars they send home is eqiuvalent to less in terms of pesos.
In January 2 this year, if an OFW sent $100 to his or her family in the Philippines, this is equivalent to P4,391.90. Using the exchange rate for the last trading day of the year, the $100 will only be worth P4,105.
This means less pesos to spend for various needs such as education, basic needs like food and utilities, and other expenses. There is also less room for savings and investments.
Total dollar value of remittances, however, has been resilient, data from the Bangko Sentral ng Pilipinas showed. OFW remittances fuel consumer spending, which is a backbone of the Philippine economy. * Business Process Outsourcing (BPO) firms
An appreciating strong peso strikes at the heart of the industry's -- and the Philippines' -- cost competitiveness as an investment destination. Business Processing Association of the Philippines (BPAP) president and CEO Benedict Hernandez said the appreciation of the peso has made handicapped them as they combat challenges from top rival India.
Hernandez had said they would have still remained competitive if the exchange rate stayed at P42:$1, but not beyond that since it widens the cost difference between putting up a BPO firm in the Philippines and India.
"The combination of an appreciating peso and a depreciating Indian rupee has provided India with a meaningful cost advantage," the BPAP had said. The Philippines has already dislodged India as the call center capital of the world.
At stake are about 638,00 direct jobs from the voice-based (call centers) and non-voice-based BPOs. Before the exchange rate issue, the industry players were hoping to double this to 1.3 million direct jobs and hit revenues worth $25 billion by 2016. * Exporters
Manufacturers and retailers of products sold abroad are face with Philippine-made products becoming more expensive when the peso appreciates. They either increase the prices of their goods abroad at risk of reducing demand for these items and products, or maintain their dollar prices and suffer losses as their peso-based production costs soar.
While exports are one of the country's highest dollar earners, along with remittances, they are also a key generator of jobs that are put at risk when the business costs become unsustainable. Export groups said this has caused half of the country's small exporters to close shop.
University of Asia and the Pacific (UA&P) economist Victor Abola said the government should allow the peso to depreciate by around 20 centavos every month. "I believe that the peso is 20 to 30% overvalued. The peso should be around P50 to the dollar to make the country competitive as India, whose exchange rate is at 55 to a $1," Abola explained. * Local firms
A strong peso also encourages cheaper imports, which in turn would threaten local producers, according to Socioeconomic Planning Secretary Arsenio Balisacan.
"We have to be worried by the appreciation of the peso because it affects the lives of ordinary people. It affects employment," Balisacan said, stressing that a strong peso will threaten to erode the country's overall competitiveness.
On the other hand, Balisacan noted that a strong peso also encourages the flow of hot money or investments in stocks and bonds, which help develop the local capital markets. Cap on hedging
On Wednesday, December 28, the Bangko Sentral ng Pilipinas announced it will impose limits on local and foreign banks' forward positions -- or non-deliverable forwards (NDF) in industry lingo -- to slow down the peso's strength.
Previously, there was only a gentleman's agreement among the banks regarding forward positions on currencies.
Local banks must now limit their NDF transactions to 20% of their capital, while foreign banks are allowed up to 100%. Violations will be dealt with as a supervisory issue.
The new rules will take effect after February 2013 to give banks time to adjust to these new limits.
NDFs, which began as a hedging facility, have attracted speculative flows that have boosted the peso to P40-to-a-dollar territory this month.
The BSP has previously set its exchange rate forecast for 2012 at the P42 to 45 range. - Rappler.com
Strong or weak peso’s effects ‘The country’s historically high supply of dollars is owed principally to the continued deployment of Filipino workers abroad. The deployment may even be at a faster clip as the economies of the West - the United States and the European Union - continue to recover from their debacles.’
The Bangko Sentral “lost”, meaning lost, an estimated P56 billion since last year to stop the dollar from getting too strong. It exercised its market intervention function by buying dollars to help create more demand.
It may be too early to tell but at the rate the peso is deteriorating mainly because of the strengthening of the US dollar, the BSP might again intervene in a reverse manner. To stop the peso from weakening the BSP may sell the dollars that it bought.
Market intervention has the same purpose of protecting the Philippine currency. It may intervene this time by selling what it bought. In the accounting sense, the BSP makes a profit simply because it can sell at a higher rate the dollars it bought at a low rate.
If it sells, this time at a higher cost, the difference gives the BSP hefty profits. If its average buying is say $41 and sells at say, $43, the difference is treated as profits in the profit and loss statement.
It must be pointed out, however, that the BSP is not in the business of making or losing money. Either of the two actions is made in the name of stability. In this sense, intervention is clearly a balancing act.
Monetary authorities cannot be happy over a peso that is too strong for various reasons. First, a very strong peso makes Philippine exports uncompetitive. However as persistently asserted on this space, the competitiveness is more imagined than real for the reason that the same strong peso makes expensive the importation of components that go into the manufacture of export products. A strong peso denies the families of OFWs additional purchasing power. They get less from the remittances.
Just as important is the fact that a strong peso may have the tendency of discouraging foreign investments - direct or portfolio. The foreign investor gets fewer pesos from the dollar. That, however, is more theoretical than factual. Foreign investments are attracted by climate, not necessarily by the weak or strong currency. By leaving business alone, the Aquino government automatically created that climate.
A strong currency has the direct effect of slowing down the movement of prices or inflation. It facilitates stability. It keeps interest rates low.
On the other hand, a weak peso can have a price push that can dampen demand. In the theoretical sense, when small volumes of goods are chased by more money the effect is for consumers to pay more and yet get less.
The situation gets worse because the economy has developed a higher propensity to import essential goods as a function of the hauling down of tariff walls demanded by the country’s accession to the World Trade Organization. When imports become more expensive, there should be the consequence of encouraging domestic production.
The above views are classical economic beliefs. The real world in the Philippines is remarkably different in relation to what appears weakening of the currency. To begin with the deterioration of the foreign exchange rate is not exclusive to the Philippines. It is worldwide but more particularly felt in the Asian region.
The principal reason as is widely known is the strengthening of the dollar. The fear is compounded by the expectation that the Federal Reserve, the central bank of the United States may have to stop, or at least minimize its already bloated inventory of fixed income securities such as bonds.
As is usually said, every time the United States sneezes, the Philippines catches a cold. This time it is the region catching the cold, the US being its big trading partner. As a layman uneducated in economics, least of all in monetary affairs, I hazard the guess that the negative impact of the weakening currency could not halt the growth pattern of the economy.
There is comfort in the fact that the country’s supply of dollars has never been that big at about $85 billion. Juxtaposed to this enviable situation is the fact that the economy’s foreign obligation is less than half of reserves at about $35 billion. It may be sensible to point out that unlike in the past the country does not have to borrow to pay a debt that in turn would sink the peso deeper in relation to the dollar. The economy may not go through galloping inflation. That comfort is not small.
The country’s historically high supply of dollars is owed principally to the continued deployment of Filipino workers abroad. The deployment may even be at a faster clip as the economies of the West - the United States and the European Union - continue to recover from their debacles.
In this sense, the “sick” peso has a physician in the OFWs.
The real world is such that the ailment of one benefits the other. The debacle of the United States followed by the European Union helps make the Philippines one of the fastest growing emerging markets in this part of the world.
The Philippine economy learned the biggest lesson of flying to safety from these debacles. That is the principal reason why sovereign liabilities have practically become the most attractive investments. The banks, feeling the slowdown in demand and being themselves selective in granting loans, came up with a slew of other products not exactly remotely related to the main purpose of attracting deposits and lending them for interest income.
The non-bank products are unlike sovereign liabilities but they are just as safe. The stiff competition among banks makes it so. A situation like this has a positive effect on the foreign exchange rate.
There should be no fear that the service industry, particularly business process outsourcing and tourism, would be affected by the deterioration of the exchange rate.
On the contrary, the tourists will find the country attractive if only in the sense that their dollar gets more pesos as a function of the strong dollar. email: amadomacasaet@yahoo.com
Strong peso to hurt Philippine economy
The strengthening of the Philippine peso against the US dollar, in tandem with higher inflation, will be among the factors that could cause the country’s economic growth to slow to 5.5 per cent in 2013 and 2014 against earlier predictions of above 6 per cent, US-based investment bank Goldman Sachs said in a briefing on May 23 in Manila.
Mark Tan, ASEAN economist of Goldman Sachs, said the country’s GDP growth will be around 5.5 per cent in the next two years and an average of 5 per cent between 2013 to 2016. These forecasts are lower than the government’s projection of 6 to 7 per cent in 2013, and 6.5 to 7.5 per cent in 2014.
Goldman Sachs projects the peso to strengthen further to 37.5 pesos to the dollar in the next 12 months from March 2013 from its current level at above 41 pesos.
The bank in a report forecast inflation in the Philippines to increase to 4.2 per cent in 2013 before slowing to 3.8 per cent in 2014. Tan said some of the inflation drivers include the strong domestic demand and robust credit growth in the Philippines. The inflation rate stood at 3 per cent in the first quarter of 2013 and at 2.6 per cent in April.

How does Philippines fare with the continuing peso appreciation?01/05/2013 | Rate this article:Current Rating: 5
Read 1269 times. | Philippine peso emerged as the second-fastest appreciating currency in Asia and the fourth-fastest among all the actively traded currencies in the world for 2012 according to the Bangko Sentral ng Pilipinas. During the last day of trading, it posted a value of Php41.05 against US dollar. It started the year with a value of Php43.619 which makes its latest currency 6.53% stronger. The Philippine peso hit its strongest rate since January 2008 last December 8 as it closed at Php4.862.Peso-Dollar Exchange Rate Trend for 2012Source:RapplerWith this increase in the value of peso, the Bangko Sentral ng PIlipinas (BSP) has been in discussion with some of the local banks of the country to regulate its exposure to the non-deliverable (NDFs) and financial instruments being used to evade currency exposure. There has been a forecast that the peso would hit P38.50:1 value in the next two months.Source: Interaksyon Reasons for the Peso GainIt is said that the rise of peso along with the weakening dollar is due to President Obama’s firm decision of imposing higher tax rates to the rich which he believes is essential for the US economy not to fall in the fiscal cliff. On the domestic scene however, the increasing peso rate has been due to the improving rates it posted especially during the last period of the year caused by the rise in the foreign exchange inflows, large remittances of overseas workers, foreign investments of peso-denominated portfolio assets and foreign investments from the BPO sector.This is supported by the Manila Times as it cited the following reasons as the cause of the increasing Philippine peso: 1. The continuing bad health of the US and European economies, and improvements in the US economy. 2. The never-ending increase in OFW remittances to their families, 3. The continuing surge in Gross Domestic Product, which in the third quarter this year grew by 7.1 percent, more than twice the GDP figure of the third quarter of 2011 4. The good news that the latest Forbes’ “Best Countries for Business” List has raised our ranking to 87th among 141 countries, ahead of China (96th) and India (97th) 5. The large foreign exchange reserves of the Bangko Sentral ($82 billion) and the P2.95 trillion in deposits (savings) held by the Philippine banking system, 6. The relatively low inflation rate, and 7. Many other indicators showing, as the government and the Bangko Sentral love to boast, that ours are “very sound fundamentals.”The positive performance of the economy could also be attributed to the economic measures presently implemented by the government. These projects seem to be working well that it has resulted to positive reviews about the country’s economic performance. This trend is expected to continue on the succeeding months. Every peso countsWhile the Philippine economy is growing in line with the continuing bad health of the Western economies, the sudden boost to the Philippine peso could not be immediately interpreted as a good sign for the country. Some economists shared that the peso growth also has its negative effects to the economy as well as to the performance of the various industries in the country. In general, Socioeconomic Planning Secretary Arsenio Balisacan explained that the strong peso value may cause the following: 1. make Philippine-made products expensive abroad; 2. erode the; purchasing power of Overseas Filipino Worker (OFW) remittances 3. encourage the flow of hot money or investments in stocks and bonds 4. reduce exporters' earnings; 5. threaten local firms' earnings through cheaper imports.The Philippine economy is affected by any movement of the US economy and vice-versa since US is the largest and most steady buyer of the country’s products. The economy is also affected by the amount of remittances coming in the country. They are playing a major role in contributing to the inflow of money in the Philippines. Due to this stronger peso, the debts of the Philippine government, banks and private corporations which are denominated in dollars are now at a lesser value so they would need to spend less to pay these debts. OFWsThis however affects the remittances coming in the country through the overseas Filipino workers (OFW). The higher value of peso means that the value of peso shrinks and so, the OFWs should send more in order to maintain the same amount of income they are previously sending out to their loved ones in the Philippines. Despite this effect of these higher remittances to the OFWs, the government continues to claim that the remittances coming in the country is till flourishing. ExportersThe export companies have warned that the increasing peso rate could cause the laying off of workers or shutting down of some of their operations. Some of the exporters in the country, particularly in Cebu, are already anticipating the impacts of this to their industry. The Philexport Cebu recently held seminars concerning the process control that aims to improve the industry by implementing controls on the processes and cost structures. Some exporters of the country are already noticing and experiencing the decline of the industry. Aside from this, other problems faced by the industry according to Exporter and Gift, Toys and Housewares (GTH) Foundation Inc. – Cebu president Ramir Bonghanoy includes the slow growth in US and Europe economies, P20 wage increase, strong appreciation of the peso and the natural calamities hitting the country. Due to this, there would be a downsizing in his business as he reduces his employees from 350-285 and 30-50 more by next year.This, according to Bonghanoy however could be avoided by implementing some reforms in the business by making investments on new technologies, adopting some innovations and expanding the market just like what he does. Business Process Outsourcing (BPO) FirmsAccording to Benedict Hernandez, Business Processing Association of the Philippines (BPAP) president and CEO, the appreciation of peso widens the cost difference of putting up a BPO firm here in the Philippines and in India. In a statement, BPAP said that, “the combination of an appreciating peso and a depreciating Indian rupee has provided India with a cost advantage”. The competitive peso rate according to them is P42:$1 but beyond that, the industry would be gravely affected. Due to this, the fate of about 638,000 employees from the voice-based (call centers) and non-voice BPOs are at stake.Also, this affects the profit margin BPO companies are getting from their clients. Even though all of their expenses are being paid in peso, the resources from abroad are being paid in dollars so they are gaining less than they used to. |
Strong US dollar, stronger Philippine peso
PHILEQUITY CORNER By Valentino Sy (The Philippine Star) | Updated June 11, 2012 - 12:00am 0 5 googleplus0 0
The ongoing political uncertainty in the Eurozone, concerns of a Greek exit and escalating woes in Spain and Italy have pushed the US dollar up strongly last month. Moreover, the sell-off in the equities and commodities markets last month as economies around the world began to register slower growth (as shown in the recent global manufacturing PMI numbers) sent investors fleeing to the safe harbors of the US dollar.
Escalating EU debt crisis
The US dollar index had its strongest rally in seven months, gaining 5.4 percent in May alone. The main reason is that the euro which makes up 60 percent of the US dollar index collapsed on the weight of the escalating EU debt crisis. All eyes now are set on the outcome of the Greek elections set on June 17 even as a new crisis developed over the weekend as a union representing municipal workers who are a key part of the voting process threatened to strike. Meanwhile, the EU is now scrambling to stem the contagion after Spain sought a 100-billion euro lifeline to recapitalize its ailing banks.
Lack of alternative safe havens
The EU crisis, the slowdown of global growth and fears of a hard-landing in China led investors to sell equities & commodities last month to seek safer havens. But with other traditional safe haven currencies such as the Swiss franc and Japanese yen now out of the picture, the US dollar is the only safe haven currency left. Recall that Swiss decided to peg the Swiss franc to the euro last year after experiencing massive capital inflows and strong currency appreciation. Likewise, the Japanese authorities continue to aggressively intervene in order to protect their domestic and export industries from a stronger yen.
Major currencies fall in May
Business ( Article MRec ), pagematch: 1, sectionmatch: 1
The euro, which is down 7.2 percent since registering a peak in February, has dropped to its lowest in two years. Meanwhile, the Australian dollar dropped below parity in May and joined the Canadian dollar which likewise slid below parity last month. Following the sharp sell-offs in May, all the major currencies are now down year-to-date against the US dollar.

Source: Bloomberg, Philequity Research
Philippine peso remains stable
In the current risk-off environment where investors favor the US dollar against most risky assets, the Philippine peso remains one of the most stable currencies in the world. Although the peso declined last month concurrent with the drop of other currencies vis-à-vis the US dollar, it is down just 2.8 percent from its peak registered last Febr. 9. The peso’s performance is way better compared to the average declines from peak of 6.7 percent for major currencies and 5.4 percent for Asian currencies.
In fact, the Philippine peso is the best performing Asian currency year-to-date. Despite a generally strong US dollar, the peso is much stronger, gaining 1.4 percent against the greenback year-to-date.

Source: Bloomberg, Philequity Research
Peso continues to trade at its sweet spot
In one of our previous articles (see Peso’s Sweet Spot, January 30, 2012), we said that: “At 42 to 45, we believe that the peso is in its sweet spot against the US dollar. The BSP likes the exchange rate to stay in this range because it is good for the economy. Philequity also likes the peso to stay here because it is likewise good for the stock market.
We do not want the peso to be too strong because if it appreciates too much, it will surely hurt the OFWs, the exports, the BPO industry, and the export sector. At the same time, we do not want it to be too weak more so when inflation starts going up which is detrimental especially to the poor.
Between 44 and 44.50 are good levels to buy the peso.”
Philippine Peso (2010 to present)

Source: Technistock, Philequity Research
The peso continues to trade at its sweet spot. And with $76 billion of gross international reserves as of May, we expect the Bangko Sentral ng Pilipinas (BSP) to be clearly at the helm to backstop any sharp volatility that may arise from further escalation of the EU debt crisis. The latest GIR figure is enough to cover 11.4 months worth of imports and 6.6 times worth of short-term foreign debts.
Stronger peso, a vote of confidence
Last week, we noted that the Philippine economy grew strongly in the 1st quarter of 2012 in sharp contrast to the slowdown happening around the world (see Philippines, One of the Few Bright Spots Left, June 4, 2012). We expect this growth to be sustained given the major investments lined up in the pipeline (PPP projects), the government’s healthy revenue growth, the manageable fiscal deficit and the high trust rating in the Aquino government. As a result, the Philippine stock market continues to be the best performing market in Asia and currently ranked among the top 10 in the world on a year-to-date basis.
The peso is one of the key parameters that show whether our economy is stable and resilient. This is the reason why we not only set our sights on the stock market and economic growth indicators, but on currencies as well.
Hence, the stronger & more stable Philippine peso is another vote of confidence for the country. So while the Philippine economy will not be totally immune from any external crisis, we are confident that our stock market and economy will continue to be resilient and be one of the first to bounce back.
For further stock market research and to view our previous articles, please visit our online trading platform at www.wealthsec.com or call 634-5038. Our archived articles can also be viewed at www.philequity.net.

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...TermPaperWarehouse.com - Free Term Papers, Essays and Research Documents The Research Paper Factory JoinSearchBrowseSaved Papers Home page » Social Issues Why Social Networking Sites Are Addictive In: Social Issues Why Social Networking Sites Are Addictive “Why Social Networking sites are so addictive” Next to the numerous games that often hooks are attention, another thing that most parents problems today towards their children is the social networking sites that is said to be addictive due to its unlimited offers. The connection that can be made between two people distant to each other is such a thing that you simply cannot resist. Not only is discovering new content through all the retweets almost invaluable, but simply striking a conversation about common interests or thanking people for retweets, is a joy! Once you've gotten involved in networking sites, things can escalate quickly. One reason these sites are so addictive is that there's a nonstop stream of messages, photos, updates and information coming from those in your network. If you have 10 friends, it shouldn't be a problem keeping up with them. If your network is 100 friends or more, you might end up online for hours every day, trying to check all of the updates. If you're trading messages back and forth with other members, you might find yourself even more caught up in the exchange, just as you would in a normal conversation. We’re able to communicate with so many people from all across the......

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...How to Make  Term Papers Outline ?   A good term paper outline should have the following sequence and contents to write a term paper. Introduction Introduce the topic of your term paper about which you have to write the term paper and proceed to write thesis statement. Thesis statement Thesis statement is an essential part of any term paper. Develop a thesis statement which clearly states the point you are discussing. Body of the Term Paper The body of the term paper has all the points to discuss and support with favorable evidences, experiments or examples. Present the collected data in a way that supports the thesis statement. Conclusions It is the final part where you have to present all the results you got from the research and make suggestions for further development in the field. Bibliography It is the list of references of the sources of information. There are different formats of referencing the information resources such as APA, MLA, Harvard, etc. So use the one instructed by your supervisor. CONTENTS: STEP 1. CHOOSE A TOPIC STEP 2. FIND INFORMATION STEP 3. STATE YOUR THESIS STEP 4. MAKE A TENTATIVE OUTLINE STEP 5. ORGANIZE YOUR NOTES STEP 6. WRITE YOUR FIRST DRAFT STEP 7. REVISE YOUR OUTLINE AND DRAFT               Checklist One   Checklist Two STEP 8. TYPE FINAL PAPER STEP 1. CHOOSE A TOPIC Choose a topic which interests and challenges you. Your attitude towards the topic may well determine the amount of effort......

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...A term paper is a semester written project that can be in a form of either an essay or a structured research paper. Basically it intends to enhance or develop the skills of the students in the aspects of communication, resourcefulness and discipline. Now what are the parts of a term paper that you should know about? Let me give you the five basic parts necessary for this article. 1. The cover page is the first part of the term paper. Actually it does not contain anything about the topic you have selected. It is just a page that provides the title of your work as well as details about you as the writer. A standard term paper usually has a separate cover page before the main pages of the article. 2. The next part of a term paper is the introduction. This is integrated in the actual page structure of the project. You need to provide a background of the topic that you have written. In this paragraph, make sure that you provide details why the topic is important and what is to be expected in the contents of discussions. You also need to place the thesis statement at the introductory paragraph. 3. The third part of a term paper is the body. Actually you are not limited to using only one paragraph. Depending on the discussions of the topic, you can expand the number of body paragraphs indefinitely. Some research term papers for school will have to contain discussions like methodology, literature review or pictures and diagrams. But always make sure that the body can support the......

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...Unit 10 Research Paper Part 6: Final Draft of Research Paper Course Objectives and Learning Outcomes * Demonstrate mastery of the writing process, from invention to revision. * Apply principles of composition to evaluate the effectiveness of multiple rhetorical strategies. * Explain and employ the concepts of purpose, audience and tone in relation to compositions. * Locate, analyze, evaluate, and use information from a variety of sources, including the ITT Tech Virtual Library. * Formulate and execute a practical research plan. * Refine the research paper’s introduction and conclusion. * Revise and complete a final draft based on peer and instructor feedback. Assignment Requirements Use your research diary and the revised copy of your research paper to create your final draft. In your final draft, be sure to include: Introduction 1. Consider to whom you will be delivering this information. * If nothing really comes to mind, free-write about everything you know about your audience. 2. Overall, start broadly and narrow as you go. Consider your thesis as the target. * Other strategies also work well, but remember that the goal of an introduction is to help your reader understand why this information is important and/or interesting. 3. Decide which of the five introductory moves works best. * You may have to try a couple different methods here. Don’t be afraid to experiment with your writing. Talk it out with......

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...StudyMode - Premium and Free Essays, Term Papers & Book Notes Essays Resource Center Sign Up Sign In Products Home Research Drive Answers About Company Legal Site Map Contact Advertise ©2015 StudyMode.com HOME > LITERATURE > PERIODICALS > PHYSICAL ENVIRONMENT IN... Physical Environment in Counseling and Planning Only available on StudyMode Topic: Feeling, Office Pages(s): 7 (1656 words) Download(s): 99 Published: October 18, 2008 READ FULL DOCUMENT SAVE TO MY LIBRARY Please sign up to read full document. TEXT PREVIEW Physical Environment in Counseling and Planning I have recently read an interesting article about the impact of physical environment on the financial counseling and planning relationship and process. The publication raised my great interest because I have noticed before that our offices have several deficiencies that may have negative effects on the quality of our relationships with clients. The physical environment includes many aspects of our surrounding, including furniture and room design, color, accessories, lighting, sound, smell, thermal conditions and others. I have learned that all of these aspects can have bigger impact on relationships and the quality of our work that most people would expect. Therefore I took the initiative and researched the topic a little further to get a better understanding of the issue. Although there’s not a lot of a material available that refers strictly to financial......

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... They want to asses if the spread of technology would become a distraction or a help to a student. The investigators were appealed to the topic because gadgets are now able to provide easier access to information and educational advantages. Gadgets get the attention of the students because of its engrossing and fascinating presentations of information. This also helps the parents who are unaware of the effects of gadgets to their child’s study. Overuse of gadgets may result to interference with the student determination and ability to learn. Technology can be used for many things some positive and some negative. The effects that are now being documented on children whom are left unattended for hours on end are nothing but negative. Long term damage is more prevalent in the recent studies than ever before. Researchers are finding that many parents are using the internet and other form of technology to “raise” their children. Thus...

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