Colombia: Colombian peso plunges to over-five-year low on tumbling oil prices
December 4, 2014
The Colombian peso (COP) depreciated against the U.S. dollar in November, continuing the trend that has been in place since early July. On 28 November, the currency traded at 2,217 COP per USD. This was 7.9% weaker than the level recorded on the same day in October. In annual terms, the Colombian peso lost 15.0% against the U.S. dollar. In the beginning of December, the peso continued to depreciate slightly. On 2 December, it traded at 2,297 COP per USD, the weakest value since April 2009.
The Colombian peso weakened against the U.S. dollar as a sharp drop in oil prices is dampening the growth prospects for petroleum-producing countries. The sliding crude oil price is putting Colombia’s public finances under pressure. Oil accounts for the lion’s share of the country’s exports as well as a significant part of government revenues. On the upside, Finance Minister Mauricio Cárdenas pointed out that the weaker Colombian peso is likely to foster growth in the country’s other export industries, particularly the manufacturing and agricultural sector.