The peso hit a fresh eight-year high against the US dollar on Thursday as dollar weakness spurred investors to buy the high-yielding currency, but the rise met with some resistance due to local political concerns.
The peso hit 40.25 per dollar, just shy of a big resistance level at 40, marking its highest level since February 2000 and taking gains in the past week to 0.7 percent.
“I don’t think it will hit 40 today. There’s some risk aversion for tomorrow’s anti-GMA rally,” a trader in Manila said, referring to a rally to be held on Friday by protesters calling for President Arroyo’s resignation over a corruption scandal. “I see 40 tested may be next week if tomorrow’s rally is peaceful.”
The peso has climbed 2.5 percent so far this year, lagging behind most of the Asian currencies, compared to its top position in 2007.