Business sentiment in the Philippines has soared to an all-time high after the country was awarded investment grade credit ratings.
The central bank said the overall confidence index rose 54.9 per cent from the first quarter's 41.5 per cent. "This is the highest reading since the start of the nationwide survey in the fourth quarter of 2006," said the central bank.
The confidence index is the percentage of firms that answered in the affirmative less the number of firms that answered in the negative with respect to their views on a given sector. But that failed to boost confidence in the country's currency, which dropped the most since March 2009 yesterday.
The currency fell 1.2 per cent to 41.69 per dollar at the close in Manila amid speculation that an improving US economy would prompt the Federal Reserve to reduce asset purchases.
"A recovering US economy and prospects of the Fed starting to tighten raise the possibility of some of the funds moving out of emerging markets like the Philippines," said Rolando Avante, the president of Philippine Business Bank in Manila.