After a session marked by strong volatility, the dollar in Chile ended lower this Thursday. This, after new data showed that US producer prices recovered more than expected in Januaryunderscoring lingering inflationary pressures that could push the Federal Reserve to seek further interest rate hikes.
According to Bloomberg, after hitting an intraday high of $802 at around 10:55 a.m., the exchange rate reversed its trend and closed with a drop of $1.57 at $792.48, placing the Chilean peso as the fourth best performing emerging currency during the session.
Thus, the local currency was coupled to the volatility of the dollar index -which measures the value of the US currency relative to a basket of foreign currencies and trades nearly flat- and by Copper on the London Metal Exchange rose 0.75% to $4.033 a poundaccording to Cochilco.
After the report of consumer price index (CPI) in the United Statesyesterday the retail sales in the country, revealing the biggest jump in almost two yearswhich, while reinforcing confidence in the growth outlook, also supported the Federal Reserve’s stance of further raising interest rates.
“Macroeconomic data from the United States has shown that the US economy has remained strong, and gives us clear signals that the Fed should maintain its tightening policy. We should not see losses, even one more rise is gaining more and more strength,” explained the general director of BefX, Rodrigo Castillo.
“If one more rate hike by the Fed materializes, we could consolidate above $830″project.