PESO RECOVERS SLIGHTLY, CLOSES AT 55.98 TO A DOLLAR

MANILA,  January 31, 2004 (STAR) The peso regained some lost ground against the dollar yesterday, after falling to its lowest level ever on Thursday, on fears the Bangko Sentral ng Pilipinas (BSP) may use monetary tools to curb the local currency’s weakness.

Dealers said the peso’s fall to a historic low of 56.220 to the dollar on Thursday was overdone, and that the market had to correct itself on its own.

At the Philippine Dealing System (PDS), the peso gained three centavos to settle at 55.980 from Thursday’s close of 55.010 to the dollar. The peso traded between 55.820 and 55.060 on a volume of $128.80 million.

Analysts said the peso was buoyed by profit-taking on the dollar’s recent rise and a lack of corporate demand for the currency.

Dealers said the market was cautioned by BSP Governor Rafael B. Buenaventura’s open-ended statement that while the monetary regulator intends to keep benchmark interest rates steady, it still could resort to either a rate hike or an increase in banks’ reserve requirement should the peso’s weakness persist.

The BSP chief blamed the peso’s fall on a confluence of factors, which include a strong dollar, month-end dollar requirements of companies and importers, political noises related to the upcoming elections and a rumored military uprising.

"We’re paying premium for some instability," Buenaventura said.

He said the currency risk protection program available to importers has helped reduce pressure on the local currency.

The BSP chief ruled out any speculative play.

"The peso’s recovery should not be surprising. Falling to 56 was overdone. The market did correct to a more rational level," a local bank dealer said.

Makati earns P1.8 billion in January taxes By Nikko Dizon The Philippine Star 01/31/2004

Makati City collected a total of P1.8 billion in business and realty taxes from Jan. 2 to 28, the city government said in a statement yesterday.

According to City Treasurer Luz Yamane, realty taxes alone reached a total of P794.28 million or P44 million higher than the total collection for the same period in 2003.

The city’s taxes fund the city government’s expanded public services, the statement said.

Some of its projects are free meals and multi-vitamins for Makati’s public school students, new barangay computer centers, free computer literacy courses and internet use for residents.

The statement also stated that the tax collection in Makati has steadily rose since 1986.

From an annualy income of only P310 million in 1987, total revenue grew to P5.9 billion in 2002.

Opposition Councilor Oscar Ibay, however, told The STAR that despite the astounding January collection, the city government still has to pay bank debts amounting to P4.5 billion. He said the rise in tax collection was expected because business establishments pay the mayor’s permit in January.


Reported by: Sol Jose Vanzi

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