Peso falls as ETB plunge spurs demand for dollars

Colombia’s peso fell for the first time in three days after a 27 percent plunge in Empresa de Telecomunicaciones de Bogota SA sent the benchmark IGBC Index down the most since 2008, spurring demand for dollars.

The currency weakened 0.1 percent to 1,813.18 per dollar at 3:11 PM. New York time, from 1,811.91 Wednesday, erasing earlier gains of as much as 0.3 percent. Today’s loss pares the peso’s jump this year to 12.7 percent, the best performance among all currencies tracked by Bloomberg.

ETB, as the state-run telecommunications provider serving Colombia’s capital in known, was unable to lure bidders for a proposed auction in which it sought to find a strategic investor, it said today in a statement.

“The general decline in the market after the news about ETB weakened the peso a little,” Juan Pablo Vieira, a currency trader at Interbolsa SA, Colombia’s biggest brokerage, said today in a telephone interview. “This caused people to buy dollars, and the peso lost some of its correlation with other Latin American currencies.”

The yield on the benchmark 11 percent bonds due 2020 was little changed at 7.07 percent, according to Colombia’s stock exchange. The bond’s price fell 0.024 centavo to 127.310 centavos per peso. (Nathan Gil / Bloomberg)

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