Bloomberg News

Philippine Peso Falls as U.S. Data, Earnings Cut Risk Appetite

October 19, 2012

The Philippine peso dropped for a second day as an increase in U.S. jobless claims and company earnings that missed forecasts damped demand for riskier assets.

The MSCI Asia Pacific Index of equities retreated for the first time in four days after Google Inc. (GOOG:US), Philip Morris International Inc. and Microsoft Corp. reported profits and sales that trailed estimates. U.S. unemployment claims rose to 388,000 in the week ended Oct. 13, more than the 365,000 predicted in a Bloomberg survey.

“The rise in jobless claims didn’t help sentiment,” said Saktiandi Supaat, head of foreign-exchange research at Malayan Banking Bhd. (MAY) in Singapore. “Risk appetite also retreated because of the lower-than-expected earnings from some of the U.S. multinationals.”

The peso fell 0.2 percent to 41.385 per dollar as of 4:31 p.m. in Manila, trimming this week’s advance to 0.1 percent, according to Tullett Prebon Plc. The currency dropped 0.4 percent yesterday, the biggest decline this month.

One-month implied volatility for the peso, a measure of exchange-rate swings used to price options, was little changed today at 5.25 percent. It fell five basis points this week.

The country had a balance of payments surplus of $751 million in September, up from $582 million in August, data from the central bank showed today.

Government bonds were little changed today. The yield on the 4.75 percent notes due September 2022 held at 4.70 percent, according to data from Tradition Financial Services. It fell three basis points, or 0.03 percentage point, this week.

To contact the reporter responsible for this story: Elffie Chew in Kuala Lumpur at echew16@bloomberg.net.

To contact the editor responsible for this story: James Regan at jregan19@bloomberg.net


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