Peso rises to eight-month high on US inflation data

The peso surged to its strongest in over eight months as investors went for risky assets after the US reported slower inflation in June.

 

The local currency surged by 17.5 centavos to 43.235:$1 from 43.41 Tuesday. This was the peso's strongest since it closed 43.20:$1 on Nov. 8, 2013.

 

"There was risk-on sentiment in the region, propelling emerging Asian currencies against the dollar," Bank of the Philippine Islands economist Nicholas Mapa told GMA News Online.

 

The sentiment may have been triggered by the lower-than-expected US inflation, he said.

 

"The lower-than-expected data shows less likelihood for Federal Reserve to raise interest rates," Mapa said.

 

The US Labor Department on Tuesday said Consumer Price Index increased by 0.3 percent last month, with gasoline accounting for two-thirds of the gain, after May's 0.4 percent rise, Reuters reported.

 

This is way below the US central bank's 2 percent target. – VS, GMA News