By Rea Cu, February 7 2019; Business Mirror

Image Credit to Business World

The Philippine peso remains stable amid growing volatilities in the global market brought about by changing fuel prices and the US-China trade war, among others, the Department of Finance (DOF) said on Wednesday.

In its latest economic bulletin, the DOF reported that the local currency remains stable among Asian currencies, appreciating January 2019 by 0.73 percent to 52.17 to the US dollar.

For 2018, the Philippine peso posted a depreciation of 5.43 percent at 52.56 to the US dollar.

“The Philippine peso continues to be one of the more stable Asian currencies despite the uncertainties in the world market brought about by the normalization of the Fed monetary policy, Brexit, volatile fuel prices and US-China trade war,” the DOF said.

It was reported that the Philippine peso continues to move along with 12 other Asian currencies and is one of the least volatile currencies in the world’s fastest-growing region.

“The Philippine peso is also among the least volatile with coefficient of variation at 0.32 percent YTD [year-to-date], tying with South Korean won as the third least volatile currency. In 2018, the coefficient of variation of the peso was recorded at 1.91 percent, ranking seventh among 12 currencies,” it added.

For January 2019, the Chinese yuan reported an appreciation of 2.46 percent, the Japanese yen at 0.87 percent, the Singaporean dollar at 1.22 percent, the Thailand baht at 3.37 percent, Malaysia’a ringgit at 1.10 percent and Indonesia’s rupiah at 2.90 percent.

Meanwhile, the Asian currencies that posted a depreciation in the same month include the Indian rupee with 2.02 percent, the South Korean won with 0.16 percent, the Vietnamese dong at 0.11 percent, the Hong Kong dollar at 0.18 percent and the New Taiwanese dollar with 0.56 percent.

In October last year, the Asian Development Bank (ADB) reported that the high degree of uncertainty resulting from the US-China trade war could cause a “larger than expected” damage to global and economic growth.

The assessment was made by the ADB Economic Research and Regional Cooperation Department Principal Economist Donghyun Park, Senior Economics Officer Cynthia Castillejos Petalcorin and Eonomist Shu Tian in an Asian Development Blog.

The ADB team, however, said that the impact of the trade war on developing Asian countries is still limited. But if it escalates, the impact will be larger and will also hurt financial markets, the ADB economists said.