The Colombian peso strengthened on Monday, taking its cue from the Brazilian real. The peso closed at COP2,035 against the dollar, compared with COP2,044 on Thursday, as the Brazilian currency firmed on capital inflows and speculation that interest rates could rise as early as April.
When the Colombian market is quiet and illiquid and there is no important local news, the peso tends to track the real, said Ricardo Perez, a market analyst with local brokerage Alianza Valores.
“It’s strengthening because the real is strengthening,” Perez said. “The real is the main currency that influences the peso-dollar rate.”
Markets were closed Friday for the Christmas holiday.
In the debt market, the yield on Colombia’s benchmark peso-denominated bond maturing in 2020 rose to 8.490% from 8.440% on Thursday.
“Yields remain high because of the theme of rising interest rates next year, and the idea that inflation will stop falling,” Perez said.
Colombia’s benchmark IGBC stock index fell 0.45% to 11,562.42. The Colcap index, which includes the largest companies by market capitalization, was down 0.56% at 1,356.06.
Volume was low, with many market players on holiday. The market is waiting for the release of official unemployment figures on Wednesday, said Jorge Zuniga, a market analyst at Asesores en Valores.
Shares of Canada-based oil company Pacific Rubiales Energy Corp. fell 1.39% to 31,200 pesos (C$15.97). In the early afternoon, the stock was trading close to parity with its value in Toronto, having entered the Colombian market last week at a steep premium.