Not yet a strong Peso after all
Recently, I've been observing the steady rise of the Peso against the US Dollar. In fact I have been convinced that the Peso is getting stronger.
Sad to say, this may not be so. The reason for the strong Peso is still mostly due to the region's stronger currency. If you will notice, Southeast asia's currencies' have all been performing well- this includes the Peso. As a result, we have a steady 50:1 exchange rate.
To give credit to the government, they have been performing well. The continuous release of good news and the absence (gag order perhpas?) of bad news have all contributed to the strong Peso.
As a matter of fact, we have been getting better credit ratings lately from the rating agencies. For those unfamiliar with the significance of these ratings, rating agencies rate how good a payer you are. The higher the rate, the more trusting banks will be towards you. A more trusting bank gives lower interest rate as they know you won't run away or default on your payment. Therefore, a lower interest rate means less money going to interest payments and more money for the country's development. But how does this really affect our Peso?
As we all know, in the Philippines, the Peso is a barometer. It is a vote of confidence on the country. So as long as the country is doing good, the stronger the Peso becomes. Philippines has lots of dollars. These dollars are just in the hands of cautious businessmen.
Does this then mean the Peso will breach 49:1? Too early to say. Why so?
1. We have been experienceing an unusually peaceful third quarter. No coup, no people power- yet.
2. OFW remittances are still far away. Their dollars are not yet coming in.
Until November comes, and if the Peso is still at 50:1, I can safely say Peso may definitely breach 49:1.
Advice:
1. Wait until November. If the Peso is still strong, better load up on your Peso time deposits. Interest rates will drop. By February, the country will have more dollars than it needs.
As for me, I've already taken my bet and acquired a Peso time deposit. Good decision? We'll see...
**********************************************
Practice makes perfect. For your comments, you may email me at arsiph@yahoo.com
Sad to say, this may not be so. The reason for the strong Peso is still mostly due to the region's stronger currency. If you will notice, Southeast asia's currencies' have all been performing well- this includes the Peso. As a result, we have a steady 50:1 exchange rate.
To give credit to the government, they have been performing well. The continuous release of good news and the absence (gag order perhpas?) of bad news have all contributed to the strong Peso.
As a matter of fact, we have been getting better credit ratings lately from the rating agencies. For those unfamiliar with the significance of these ratings, rating agencies rate how good a payer you are. The higher the rate, the more trusting banks will be towards you. A more trusting bank gives lower interest rate as they know you won't run away or default on your payment. Therefore, a lower interest rate means less money going to interest payments and more money for the country's development. But how does this really affect our Peso?
As we all know, in the Philippines, the Peso is a barometer. It is a vote of confidence on the country. So as long as the country is doing good, the stronger the Peso becomes. Philippines has lots of dollars. These dollars are just in the hands of cautious businessmen.
Does this then mean the Peso will breach 49:1? Too early to say. Why so?
1. We have been experienceing an unusually peaceful third quarter. No coup, no people power- yet.
2. OFW remittances are still far away. Their dollars are not yet coming in.
Until November comes, and if the Peso is still at 50:1, I can safely say Peso may definitely breach 49:1.
Advice:
1. Wait until November. If the Peso is still strong, better load up on your Peso time deposits. Interest rates will drop. By February, the country will have more dollars than it needs.
As for me, I've already taken my bet and acquired a Peso time deposit. Good decision? We'll see...
**********************************************
Practice makes perfect. For your comments, you may email me at arsiph@yahoo.com
Labels: Business
posted by Arsiph at
9:16 PM
4 Comments:
I'd agree that having money in the bank is better than keeping them at home.
However, I'm doubtful of the peso's current progress against the us dollar. while the peso might be winning, the consuming power of the peso isn't improving.
How can such numbers help us in light of such terms?
By
Anonymous, At
Mon Sep 18, 10:51:00 PM
para sa akin, kahit nagiimprove ng unti unti ang peso, the quality of work we produce whether it be a product or service still hasn't improved. we still get the usual dumb saleslady. malayo pa talaga ang lahat.
~the cynic
By
Anonymous, At
Tue Sep 19, 08:41:00 AM
This comment has been removed by a blog administrator.
By
Anonymous, At
Fri Sep 22, 09:43:00 PM
omg...
arsiph... o.O
By
Anonymous, At
Sat Sep 23, 09:03:00 AM
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