The dollar in Colombia continues to set record figures as the Representative Market Rate this Wednesday is $4,744.04that is to say $107.21 above the one that was in effect yesterday ($4,636.83).
During 2022 the greenback has risen $762 in Colombia, which means that the peso has devalued against the dollar by 19.16%. For its part, in the last year the increase is $971, for a depreciation of 26.90%.
(Read: Qatar dollar, one of several exchange rates in Argentina).
In the interbank negotiations of ayer the dollar closed at $4,762, the highest in history and $64 above Friday’s close.
The minimum price of the dollar was $4,665 and the maximum reached $4,794, a value close to $4,800 and which is also the highest value in intraday trading in the country.
For its part, the average price was $4,743, data that picks up $107 compared to last Friday.
The currency continues to strengthen amid an environment of both international and local uncertainty due to high inflation, expected increases by central banks, the prospect of a possible recession and geopolitical conflicts, especially regarding related to Russia’s invasion of Ukraine.
Dollar
In addition, it must be remembered that in recent days the firm JPMorgan said in a report that the messages on the Twitter network of President Gustavo Petro have had effects on the markets, especially those related to the performance of Banco de la República, as well as the possibility of taxes on capital outflows and the ideas of the Minister of Labor, Gloria Inés Ramírez, to propose a price control for the basic basket in the framework of the discussion of the minimum wage.
(See: How the devaluation of the peso impacts the Colombian economy).
Financial analyst Diego Rodríguez says that global speculative funds are doing operations in Latin America selling the peso against other currencies in the region.
In addition, he says that the comments of members of the Government have affected the peso and if that ise adds low liquidity in the interbank marketmovements of US$20 million easily move the market.
For his part, Diego Blanco, director of investment strategies in Stocks and Securities, points out that in recent days the dollar has been strengthening against other global currency pairsl, but in Colombia there has been greater sensitivity and uncertainty generated by some comments from the government.
Some of the members of the Government have come out to clarify certain issues but the market is still afraid and there have been volatilities of more than $80 and almost $90 daily.
“The probability that the dollar reaches $4,800 is high and if in the international context the central banks continue to increase rates due to inflation, that fight could continue. That is why we could have new highs in the exchange rate and then we would see a global recession that would affect Colombia.”, said the analyst.
(Keep reading: Deficit, uncertainty and the Fed, the cocktail that erodes the peso).
Edgar Jiménez, professor of finance at the Financial Laboratory of the Jorge Tadeo Lozano University, says that the prospect of a dollar at $5,000 can shockThere were many, but remember that in Colombia there have been devaluations between 15% and 20%, this last figure, close to what it is today.
Inflation in the US influences
In the behavior of the dollar in Colombia, the main factor that influences is a greater perspective of inflation in the United States. This, according to analyst consensus, makes it almost certain that the Federal Reserve Bank (Fed) is forced to make new increases in interest rates to try to restrict consumption.
Analyst Andrés Moreno Jaramillo said that yesterday the dollar shot up but “it is not because of the international environment. It is not because yesterday or today currencies are devalued. Some time ago here several we said, for Petro and his ministers there is a high perception of risk in Colombia is not a myth. It’s not a minor thing.”
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