The Colombian peso weakened Monday after investors expected the sale of a majority stake in a local power company by Spain’s Gas Natural SA for $1.1 billion will increase demand for dollars.
The dollar fetched 1,872.60 Colombian pesos compared with COP1,843.5 Friday. The Colombian peso hasn’t closed this weak since Oct. 7.
Gas Natural agreed to sell its 63.8% stake in power generation company Empresa de Energia del Pacifico SA, or EPSA, to local holding companies Colinversiones SA and Inversiones Argos SA and the country’s largest bank Bancolombia SA for $1.1 billion.
“Investors expect either Gas Natural or those companies will have to buy the dollars from the market,” Francisco Chaves, a market analyst at local brokerage Corredores Asociados, said.
Additionally, people are anticipating the country’s central bank will take measures to stem the peso’s recent gains when it meets Friday.
On the equity market, the IGBC Stock Index rose 2% to 11,158.83 points, boosted by shares of Colinversiones and Inversiones Argos.
Shares of Colinversiones rose 1.7% to COP50,900, while shares of Inversiones Argos rose 4.5% to COP16,880. (Dow Jones)