The peso remained weak against the US dollar in early trading yesterday, hitting a low of 55.60 to the greenback after reaching fresh 31-month lows on Monday, trading between 55.270 and 55.470.
"The unfortunate brew of destabilization and partisan politics has affected the performance of our peso," Mrs. Arroyo said in a statement. "Much is being done to achieve normalcy and consolidate our gains in law and order but more can be gained if our institutions close ranks behind a serious drive for productivity, reforms and stability."
Mrs. Arroyo urged the public to shun "creeping negativism" and shake off domestic concerns, even as she noted the government was working to implement reforms.
Dealers warned that without central bank support, the peso could hit within the next two days its all-time low of P55.75 to $1, the rate posted on Jan. 17, 2000, or three days before Joseph Estrada was ousted as president by a popular revolt. "We are trading on our own domestic problems. Lingering rumors that another coup attempt may take place anytime is further weighing on the currency," a local bank dealer said.
Another dealer said: "The central bank is not in the market because they apparently know the demand (for the US unit) is legitimate."
Presidential Spokesman Ignacio Bunye, meanwhile, called on currency market players to refrain from hedging their future dollar requirements, saying their move only aggravates the situation.
Bunye, however, gave assurances that government monetary authorities were already implementing measures to neutralize or reverse the downtrend of the peso. "One kind of help that our people can do is reduce speculation of our own currency," he said.
Meanwhile, Socio-Economic Planning Secretary Romulo Neri said that strengthening the country’s political system will reduce the risk of negative perception on the Philippine economy.
Neri acknowledged the crumbling nature of the country’s political, judicial, social, religious, military and media institutions.
"The problem is that our institutions are so weak that they themselves, instead of serving as insulators, have become amplifiers of the fractiousness of politics and society," Neri said in an interview with cable network ANC’s "Talkback" on Monday night. — AFP, Marichu Villanueva, Ann Corvera