Colombia’s peso rose the most in nearly eight weeks on Tuesday, driven by higher prices for oil, the country’s biggest export.
Other Latin American currencies advanced less sharply against the dollar, while the MSCI Latin American stock index added 1.2 percent, rising for a second straight day.
The Colombian peso had weakened about 10 percent over the last month, hit by expectations for higher interest rates in the United States. In the last 12 months, the currency lost 39 percent of its value, mainly linked to lower oil prices.
The currency recovered part of those losses on Tuesday as oil prices rose, driven by higher seasonal demand in developed economies and expectations of falling U.S. shale production.
“It’s an adjustment to the international scenario after the public holiday we had yesterday, given the large bounce in commodities prices, especially oil,” said Fernando Chacon, foreign exchange analyst at the Acciones y Valores brokerage in Bogota.
“We should have relative stability at current levels until the Fed meeting, given this week there will be no important
fundamental data,” he said.
Chile’s peso, which is more sensitive to copper prices, also gained on Tuesday as the red metal’s price rose the most in nearly a month. Copper is Chile’s primary export.
Brazil’s real moved slightly higher against the dollar as the government announced a concession program aimed at drawing about $64 billion in private investment.
Equities markets were mixed, though Brazil’s benchmark Bovespa index was on track to end a three-session slump, boosted by shares of state-run oil producer Petroleo Brasileiro SA, known as Petrobras.
Shares of private education firms Kroton Educacional SA and Estacio Participacoes SA advanced after Brazil’s education minister announced the extension of a popular government student loan program.
(Reporting by Nelson Bocanegra in Bogota and Asher Levine in Sao Paulo; Editing by Jeffrey Benkoe)