Colombia: Colombian peso rises to seven-month high
March 17, 2012
On 16 March, the Colombian peso (COP) traded at 1,760 per USD, which was 1.7% above the levels recorded in the same day the previous month. The figure follows on a 2.6% appreciation in February and marks, in fact, the strongest level since July 2011. The peso has gained an accumulated 9.4% this year versus the USD. The Colombian peso has been strengthening on the back of increased global risk appetite as well as higher foreign investment flows on speculation that the Central Bank will continue to raise interest rates, following on rate hikes in January and February. As a result, international reserves have been steadily climbing in recent months, reaching USD 32.8 billion by the end of February (January: USD 32.5 billion). In a bid to tame the peso's surge against the U.S. dollar, the Central Bank recently announced that it will extend its daily foreign exchange purchase programme until at least 4 August, up from the previously announced three-month period.