Peso now 56.25:$1

The peso continued to weaken yesterday, inching closer to the record low posted in March as it closed at 56.25 to the dollar amid huge trading volumes.

For the third straight day, the peso traded downwards, opening the session at 56.010 before hitting a high of 55.90 and a low of 56.250 to the dollar.

The day’s trade was brisk with total volume turnover reaching $237 million, almost twice as high as the usual volume.

The Bangko Sentral ng Pilipinas (BSP) said the pressure was still bearing down on the peso from other regional currencies because most traders are still expecting the US Federal Open Market Committee to raise interest rates.

BSP Governor Rafael Carlos Buenaventura said, however, that regional pressures should start abating now that FOMC chairman Alan Greenspan appeared unconvinced of the US recovery.

"That should help correct the regional currencies including ours," Buenaventura said.

According to Buenaventura, the slow process of proclaiming the winning candidates in the May elections was also clouding sentiments especially abroad.

"The feeling is that there is just too much time being wasted because what investors want to see now is what the economic program will be and is it a realistic program," Buenaventura said.