The Chilean peso experienced a volatile trading day on Friday, ultimately weakening slightly against the U.S. Dollar despite a global pullback in the dollar’s value spurred by surprisingly weak American jobs data. The currency closed at 912.6 pesos per dollar, a decrease of 1.6 pesos, according to Bloomberg data.
The peso had initially surged to 928.5 pesos per dollar in early trading before retracing to a low of 906 pesos in the afternoon. The fluctuations came after the dollar had reached a 2026 high on Thursday, and marked a weekly increase of 39 pesos – the largest weekly gain since March 2024. Chile’s peso was the second-worst performing emerging market currency during the week.
Bank of America analysts noted that the peso, along with the South Korean won and Polish zloty, appeared to have overreacted to the ongoing conflict in the Middle East, attributing this to “bulky positioning” in those currencies. The net position of non-resident investors in dollar-peso forwards reversed its year-to-date decline, reaching its most dollar-favorable level since September 2022, according to data from the Central Bank of Chile.
The dollar’s correction was not limited to Chile. The Dollar Index fell 0.4% to 99 points, while copper prices stabilized at around US$5.8 per pound. The South African rand, the Chilean peso, and the Taiwanese dollar were among the strongest performing emerging market currencies.
Contributing to the dollar’s decline were U.S. Employment figures released Friday morning, which showed a loss of 92,000 jobs in February, significantly underperforming expectations of a 55,000 job gain. The unemployment rate also rose to 4.4%, exceeding the anticipated 4.3%.
These economic figures emerged against a backdrop of rising oil prices. Brent crude surged 9% to reach $93 a barrel, its highest level since September 2023, marking a 29% weekly increase – the largest since April 2020. European interest rates also experienced substantial increases. Former U.S. President Donald Trump further fueled market anxieties with a post on his Truth Social platform, stating that there would be no resolution to the conflict in the Middle East without an “unconditional surrender” from Iran.
Qatar has warned that the ongoing conflict could force Persian Gulf countries to halt energy exports within weeks, a scenario that could “sink global economies.”
