The Colombian peso on Monday strengthened to COP2001.10 against the dollar, from COP2006.25 at Friday’s close, following news on U.S. interest rates.
Federal Reserve Chairman Ben Bermanke reaffirmed plans to keep U.S. interest rates at a record low for “an extended period.”
In the morning, the peso weakened to COP2021.80, then recovered after Bernanke made his comments.
The volatility in the exchange rate on Monday was caused by movements in the dollar, rather than by local Colombian factors, said Julian Ujueta, an analyst at local brokerage Suma Valores.
“There was nervousness about what Bernanke could say, which made the dollar go up a bit, then after he spoke, it weakened again,” Ujueta said.
Colombia’s consumer price index fell 0.07% in November, compared with a 0.10%-increase median forecast from eight analysts surveyed by Dow Jones Newswires, according to data released Saturday by Colombia’s statistics department, or DANE.
However, this hadn’t had a large impact on the foreign-exchange market, Ujueta said.
Colombia’s benchmark IGBC stock index ended almost unchanged at 11,563.00 points, on thin trading ahead of Tuesday’s public holiday. The most traded stock was cement maker Cementos Argos S.A. (CEMARGOS.BO), which rose 2.3% to COP10,880. Selling by Colombian holding company Inversiones Argos SA (ARGOS.BO) apparently accounted for the heavy volumes, said Jorge Restrepo, an analyst with local brokerage Interbolsa.
On the debt market, the yield on the benchmark government peso-denominated bond maturing in 2020 rose to 8.2%, up from 8.074% on Friday. (Dow Jones)