Philippines Peso Rises Tentatively Before Rate Decision

        0315 GMT [Dow Jones] USD/PHP fell to 44.25 from Tuesday's close of 44.32, implying a stronger Philippine peso versus the U.S. unit, to reflect the overnight slump of the greenback. But the peso pared its gains to stabilize around 44.30 as the market focuses on the Philippine central bank's monetary policy meeting Thursday. The pickup in April's inflation to 4.1% on-year, versus the March reading of 3.9%, has analysts forecasting a 1.0% hike in the Reserve Requirement Ratio for banks. Raising the RRR, which stands at 19%, would crimp banks' lending ability, thus capping liquidity-fuelled excesses that cause prices to rise. A pre-emptive move by the central bank could boost investor confidence, and thereby the peso, which would keep USD/PHP inside the Bollinger downtrend channel that now caps at 44.35. (ewen.chew@wsj.com)
        (END) Dow Jones Newswires

        May 06, 2014 23:15 ET (03:15 GMT)