From ABN news room at 12:45pm on July 11, 1997
Philippine central bank announces a Peso devaluation.
The Philippine central bank announced a de-facto devaluation of the Peso, allowing it to float more freely, but that move pulled the currency down sharply. The Peso sank more than 11% to a low of 29.45 to the U.S. dollar, before trading was suspended Friday.
The central bank said the wider trading band would allow a gradual cut in interest rates to aid the country's economic growth, but gave no indication of what the wider trading band will be.
The central bank has been intervening heavily to defend the Peso, raising overnight interest rates from 15% last week to 32% on Thursday. The Peso came under attack recently, following the floating of the thai baht. The move is also expected to remove any incentive for speculating against the Peso.
Manila share prices shot up, following the Phillippine central bank's announcement. The Philippine Stock Exchange index surged more than 7.5% as investors flocked back to the market, on hopes that of a fall in interest rates.
Peso floatation jolts regional currencies.
The Malaysian central bank has already indicated that it will intervene, if the currency drops to $2.5 Ringgit to the U.S. dollar. While the Thai Baht fell briefly to a new record low, of 29.75 to the dollar, triggered by the peso's devaluation. The iIdonesian currency fell initially on the news, but has since stabilised.
Cambodia's ousted PM appeals to the U.N.
Cambodia's first Prime Minister, Prince Norodom Ranariddh wants the United Nations to restore him to power, after being ousted by his co-premier Hun Sen over the weekend. He also urged the U.N. security council not to recognise any government, resulting from the coup.
The prince said he would not return to Cambodia to face trial under Hun Sen's government. "I can't face trial before a tribunal controlled by the communist party of Phnom Penh. Hun sen should agree to free, fair elections observed by the united nations. The best tribunal is that one," he said. He also asked the U.N. to appeal to his father, king Norodom Sihanouk to mediate in the crisis.
Ranariddh made the petition during meetings with the council president, Peter Osvald, and the U.N. secretary-general, Kofi Annan, in New York on Thursday. He will also scheduled to meet U.S. under secretary of state Thomas Pickering in Washington Friday.
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