THE peso yesterday gained 60 centavos against the dollar mainly from profit-taking as banks shortened long dollar positions on expectations the government may hike interest rates again to curb inflation, currency traders said.

The local currency closed at P44.25 per dollar from P44.85 Monday, its biggest gain since February.  

“The peso is still on a downward bias but because of rising inflation, the government is also expected to hike interest rates again,” a currency trader from a commercial bank said.

Bangko Sentral Governor Amando Tetango Jr. earlier said the government is “ready to undertake further action as necessary to ensure price stability.”

Security Bank Corp. treasurer Rafael Algara Jr. said it is still “too early” to see if the peso’s recovery [Tuesday] may be the start of an appreciating, trend, especially since the currency market is still fluid.”

“This week, it should be range-bound and stay within the P44.50 support level….It is still early to say if this is a new trend since a lot can happen overnight,” he said.

THE Senate ways and means committee will start public hearings next week prior to crafting legislation to plug leaks in the collection of customs duties and taxes from imported goods.

Oil VAT cap ‘possible’

TWO of the country’s economic managers are open to studying the proposed cap on the value-added tax (VAT) on oil, but they would rather that the current tax system be kept in place to ensure that government programs remain well-funded.

MONETARY authorities are keeping an eye on countryside credit policies and programs as their role in helping the country achieve rice self-sufficiency is considered paramount.

THE peso yesterday gained 60 centavos against the dollar mainly from profit-taking as banks shortened long dollar positions on expectations the government may hike interest rates again to curb inflation, currency traders said.