The Colombian peso is at its lowest point since mid-February, amid growing speculation that the central bank will boost its daily dollar purchases in order to aid fledgling export markets.
The peso stood at 1,949.50 at 10:28 AM New York time Thursday, a 0.1% drop on yesterday’s figure, according to Business Week.
The Colombian currency has appreciated 22% in the last year, which prompted policy makers to announce that $1.6 billion would be bought by the end of June.
Now the Bank of America has said that the central bank may raise its dollar purchases to $50 million from the current $20 million.
“The daily intervention is too small,” said Pedro Tuesta, a senior economist for Latin America at 4Cast Inc. in New York.
The rising peso has had dire consequences for Colombia’s export markets.
Flower export company, Grupo Floramerica, has been forced to cut back on staff and research in the last two years due to the strong peso.
Floramerica president Nicolas Nannetti said that he’s been forced to reduce the number of per-hectare workers on his flower fields from 8 to 7.5.
The Association of Colombian Flower Exporters said that the industry has lost 14,000 jobs in the past five years and could lose 12,000 more in companies that have filed for bankruptcy protection.