MANILA, Philippines—The peso moved sideways on Tuesday, as investors adopted a wait-and-see mode amid a volatile global market following the downgrade of the US credit rating over the weekend.

The local currency closed at 42.52 against the US dollar, down by just 2 centavos from Monday’s finish of 42.50:$1.

Intraday high hit 42.44:$1, while intraday low settled at 42.79:$1. Volume of trade amounted to $1.297 billion from $1.038 billion previously.

The slight drop of the peso was consistent with the depreciation of other currencies in the region. The decline of major Asian currencies came as some investors pulled out investments in equities, manifesting risk aversion amid the uncertain global environment.

Traders said the unfavorable global environment has made investors jittery, although fund owners have been holding a general outlook that Asian economies would drive growth of the global economy in 2011.

The favorable outlook for Asian economies has been supporting currencies in the region against significant depreciation amid the global turmoil, traders said.