Effects of a strong or weak philippine peso currency essay

Even implicit suggestions of this sort proved effective in the period when no specific targets were mentioned ; more specific targets for sustainable exchange rates could be very effective today. There will be more investors coming because they can gain more than when the peso is weak.

On august, Volatility decreased to an average of P0. Eventually, by Junethe Central Bank devalued the peso to P Since market fundamentals indicate that the dollar is overvalued and needs to fall, intervention in support of that objective should be effective.

More strong investors will come as the strong peso they earn will compensate for their efforts. On the demand side, overall U. Take for illustration oil merchandises. For the Philippine Peso to be considered an advantage, first requirement is that the Philippine Peso should be strong against the US dollar.

This product is sold to get a strong dollar. As for investment, the Arroyo administration would normally go through lots of trips to other countries in order to encourage foreign investments for the betterment of the Philippine economy and its development.

U.S. paper currency and presidents (Faces) on bills

See the Appendix for details on these estimates. Inhowever, fiscal deficits grew and grew as tax collections fell, perhaps due to rampant and wide scale tax avoidance and tax evasion incidences. New Directions in the International Economy.

The daily brownouts that plagued the economy were also addressed through the enactment of policies that placed guaranteed rates. Estrada's poverty alleviation plan included the delivery of social development services, the removal of policy impediments to effective resource allocation, and the enactment of Lingap Para sa Mahirap where the poorest families were identified and given packages of assistance.

For the eurozone countries, Japan, and other economically depressed areas, this means above all convincing them to revive their economies through the use of domestic demand stimuli and structural reforms instead of relying on low currency values and export-led expansion.

There were setbacks, however, in the overall implementation of this reform program such as the Garchitorena scandal tainting the Department of Agrarian Reform DAR and supposedly exposing inefficiencies in the government bureaucracy. Ramos therefore resorted to institutional changes through structural policy reforms, of which included privatization and deregulation.

Perhaps it is not a coincidence that the two equations that yielded poor fits in differences were the equations for two such variables, i.

This created an increase in the prices of imported goods, and locally produced goods with imported components. It has a foreign exchange rate assumption of 42 to 45 pesos to the US dollar. The local price does not change.

Furthermore, Ramos was wholly focused on institutional reform in an attempt to capture the international community's perception of an improving a Philippine economy, with the agenda of increasing global competitiveness.

Fred Bergsten for calling my attention to this point. Pros of a Strong Dollar Traveling abroad is cheaper. But compared to the other non-major currencies, the dollar did not rise until the Asian financial crisis ofwhich led to the sudden collapse or devaluation of several important currencies in Asia and elsewhere notably the Thai baht, Taiwanese dollar,5 Korean won, Indonesian ruppiah, Malaysian ringgit, Philippine peso, and Russian ruble in the second half of and We recommend that officials in charge to bank on this positive outlooks and translate them and use them as leverage to further move this country forward and be lifted out of whatever hindrances of economic and social progress it deserves and has been clamoring for.

Economic history of the Philippines

BSP Deputy Governor Diwa Guinigundo said that foreign portfolio managers have preferred investing in Asia given the uncertainties and challenges confronting the United States and some European countries saddled by mounting debts. The remarkable feat of the administration, however, was that it was able to withstand the contagion effect of the Asian Crisis better than anybody else in the neighboring countries.

And this past week, the National Economic and Development Authority announced that the economy grew at a pace of 7. See the evidence cited in Blecker b. Those countries that have recently been through financial crises and have depressed domestic economies e.

Finished merchandises will be less competitory in the universe market. And finally a sector which for us is really getting the worst out of the situations are the domestic producers since a strong Peso would make imported goods cheaper since the Peso appreciates thus making it purchase imported goods more.

These interventions, which were especially large ineffectively started the dollar on its new upward course and contributed significantly to rising U.Pros and cons of a weak peso.

The Pros & Cons Of A Strong Dollar

By. It would be better if everyone would have a basic understanding of the effects of a higher exchange rate. the Philippine peso is still a strong currency. Two conflicting stories came out of a national paper this week. One announced that exporters are badly hurt by the appreciating peso while the other states that the Bangko Sentral ng Pilipinas (BSP) claims that the surging currency is beneficial to the Philippine economy.

Weak Exchange Rate Effects. A lower or weak exchange rate can have the opposite effect as a strong exchange rate or currency. Let's discuss those now. Effects of a Strong Or Weak Philippine Peso Currency Two conflicting stories came out of a national paper this week.

One announced that exporters are badly hurt by the appreciating peso while the other states that the Bangko Sentral ng Pilipinas (BSP) claims that the surging currency is beneficial to the Philippine economy.

Effects of a Strong or Weak Philippine Peso Currency Essay

Effects of a Strong or Weak Philippine Peso Currency Essay?Prospective Capital Flows and Currency Movements: U.S. Dollar vs.

A Stronger Peso: Effects of an Appreciating Currency

Euro Essay Three Faces of Eve Essay. Effects of Strong and Weak Peso The appreciation of the Philippine peso to its highest level in three years has both good and bad effects on the country's economy and numerous measures have been implied to determine as to the extent of its effects/5(3).

Download
Effects of a strong or weak philippine peso currency essay
Rated 3/5 based on 87 review