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Peso hits fresh 11-year low on US-NoKor tensions


Investors flocked to the safe-haven greenback, pulling the Philippine peso to its weakest level in almost 11 years as concerns over the escalating tensions between the US and North Korea affected market sentiment.

The local currency shed 18.5 centavos to close at P50.980:$1 from 50.795 on Thursday. This is the weakest for the peso since August 29, 2006, when it finished at P51.050:$1.

"Whenever there is geopolitical tensions, this time between North Korea and the US, investors are transferring to safe-haven assets such as the dollar," a trader from a local bank said.

"Also transfer to dollar-denominated assets pressures emerging market currencies such as the peso," the trader said.

During the morning session, the peso traded at an intra-day low of P51.08:$1 after opening at P50.90.

Bangko Sentral ng Pilipinas Governor Nestor Espenilla Jr. said the central bank is closely watching the foreign exchange market.

"We're constantly monitoring peso development for excessive short-term volatility not consistent with underlying economic fundamentals and taking appropriate action when necessary," Espenilla said.

"We recognize that the market is also often self-correcting," he added. — VDS, GMA News