The dollar in Colombia closed this Friday below $4,700, after a downward streak that has marked the most recent days in the local market.
(Dollar closed the week below $4,700).
With this drop in the US currency, the Colombian peso registers a revaluation of 1.2 percent, and thus became one of the greatest advances among emerging currencies.
But what are the causes of the dollar losing ground against the peso?
One of the reasons has to do with the new drop in inflation in the United States in December, the sixth in a series that left it at 6.5 percent, the lowest since October 2021.
This fall in the cost of living in the North American country led to a good part of the currencies strengthening against the dollar this week.
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In the particular case of Colombia, the local currency would have a greater rebound because it would be aligning itself against other Latin American currencies, which since the end of last year had been revaluing a bit.
“The inflation data from the United States was not a surprise, it was expected and generated quite important market movements against and in favor of risk assets, which include the Colombian peso, which was quite misaligned compared to what was the end of the year ( 2022) in other Latin American currencies that had been revaluing a bit”, said Camilo Pérez, director of Economic Research at Banco de Bogotá.
However, this behavior may not last long because the current economic situation, added to strong expectations of a slowdown this year, continue.
For Juan David Ballén, director of Analysis and Strategy of the brokerage firm Casa de Bolsa, the inflation data in the United States (6.5 percent per year in December 2022) favors the performance of the dollar globally.
However, it cannot be forgotten that the central bank of the United States, the Federal Reserve (Fed), is expected to raise its interest rate in the next two meetings, which, added to fears of a recession, would once again strengthen the US currency globally, increasing the appetite for safe-haven assets.
The analyst adds that the dollar in Colombia is characterized by moving with great volatility both upwards and downwards, and the rebound it had in the first days of the year could have been explained by low liquidity given the end of the season. year.
However, he warns that the trading volume in the Colombian market has already been recovering and this has allowed the currency to adjust a little more to its real level. “The dollar has been falling throughout the region except in Colombia and what we have seen recently is an adjustment towards the level it was at in the region, which is much lower”needs Ballén.
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With information from Economy and Business