Colombia’s peso continued a two-week appreciation run against the dollar on Tuesday following disappointing US job growth figures that lowered the value of the American currency against most its competitors.
The peso had been increasing in value since March 14 when one dollar was worth 2,047 pesos. Since then, the dollar dropped nearly 6% to 1,918.13 pesos on Tuesday as the markets opened.
The US currency has also been dropping against other major currencies like the yen and the euro, but not as strongly as against the peso.
Analysts told Bloomberg the depreciation of the dollar and the consequent rise of the peso is due to disappointing job growth figures released by the administration of US President Barack Obama last week.
The slight decrease has increased appetite for emerging markets like that of Colombia.
“There certainly has been more interest again in emerging markets, suggesting that many investors are again looking out for yield, and that’s clearly a risk-on scenario that is dollar-negative,” Jane Foley, senior foreign-exchange strategist at Rabobank International in London. told Bloomberg.
The recent appreciation of the peso follows a steady rise in value of the Colombian currency as a result of ongoing dollar purchases by Colombia’s central bank and measures implemented by the Colombian government to improve the situation of exporters.
The dollar had been steadily worth more than 2,000 pesos since late January, but began dropping below the 2,000 peso mark mid March.
Sources
- USD/COP interactive chart (Yahoo! Finance)
- Sigue la fuerte caída del dólar en Colombia. Hoy ha perdido 19 pesos (Caracol Radio)
- Dollar Falls to Lowest in 5 Months as Emerging Currencies Gain (Bloomberg)