Colombia’s government and central bank are preparing an “aggressive intervention” in the appreciation of the peso as the currency hit a two-year high against the dollar, local media reported on Tuesday.
The peso touched 1,786 per U.S. dollar, its strongest level since August 8, 2008. It closed at 1,790.35, from 1,791.1 on Monday. The Colombian currency has jumped 14.2 percent this year.
According to economic paper Portafolio, Congress will ask Finance Minister Juan Carlos Echeverry to create a budget to stop the dollar from losing value against the peso. Echeverry announced an “aggressive intervention in the market” and said the government is considering tariff cuts for the agricultural sector, which is losing competitiveness because of the expensive peso.
Exact measures will be announced later this week, the Finance Minister said.
According to newspaper El Espectador, Colombia’s central bank may increase interest rates after it announced it was going to use the tools available to stop the peso’s appreciation.