Peso may slide to 56 per dollar

The peso is likely to touch 56:$1 in the next three months as more investors flee emerging markets due to fears that the further deterioration in global economy will continue to batter corporate profits.

"The peso may test the P56 level (in three months)," said presidential adviser on economic affairs Joey Salceda, adding that the government and private sector should combine efforts to buoy the Philippine economy.

The local currency on Friday closed at 49.820 against the greenback, 35 centavos shy of its intraday high of 50.17. It opened at 50:$1.

The peso first breached the P50 level Thursday, with the central bank reportedly defending it by selling dollars in the market.

Astro del Castillo, an analyst at First Grade Holdings Inc., said overseas Filipino workers (OFWs) may be conserving their dollars, waiting for the peso to further depreciate.

"OFWs want to maximize their earnings. They want the peso to slide further. When they see the peso picking up again, that's the time they would scramble to have their dollars changed," he said.