One of the market movements that has attracted the most attention of investors these days is, without a doubt, that of the dollar, since on several occasions it has pushed upwards the $4,400 barrier this week. while analysts do not rule out that it could rebound again in the coming days.
Knowing what will happen with the elections in the United States, where Kamala Harris and Donald Trump compete to take the reins of one of the most important nations in the world, and how this will impact global geopolitics, are two factors that maintain uncertainty among investors, impacting the dynamics of this currency.
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To have proof of the aforementioned, it is enough to say that the dollar in Colombia experienced a notable increase in recent days, closing last Wednesday at $4,316.73, after an increase of $64 compared to the price on Monday, when it started at $4,252. . This movement marked a milestone, since the US currency has not reached such high levels since October 2023.
Although for now it is ruled out that the US currency will return to the levels above $5,000 that it had in mid-2023; We must not ignore that for now the international context is quite agitated and that will maintain volatility in the movements of the dollar, for which we must prepare, although a recent analysis by Scotiabank Colpatria says that this could calm down in November.
Dollar
iStock
For these economists, although October was characterized by instability and fears in the market, do not rule out that all this will normalize in the coming days, since it will soon be known who the president of the United States is and in this way a market fear will be overcome, which will little by little transition to an organization of your investments.
“October was a month of high fluctuation for the dollar, reaching its annual maximum, influenced by international uncertainty in the run-up to the elections in the United States and by the reactions of central banks in developed economies, keeping interest rates high,” they pointed out.
The Scotiabank report adds that “in November, the dollar situation could stabilize after the elections. In addition, it will be key to monitor the price of oil, which has maintained levels below US $75, despite global tensions”; which from their perspective have already begun to subside.
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“On November 5, the United States will elect its next president, in a scenario where the candidates could affect fiscal accounts and inflation in the country. A third of the Senate and the entire Lower House will also be renewed, which could strengthen the position of the Republican Party in Congress, either to support a Donald Trump government or to generate a counterweight in the event of a Kamala Harris presidency. , they noted in the report.
However, they emphasized that at the local level two sources of uncertainty persist.the first being the risk in the supply of public services, given the prolonged summer that has limited the reservoirs, increasing dependence on more expensive energy sources; making it clear that this month will be crucial, as it is usually a rainy month that allows reserves to be accumulated before the dry season in December.
Dollar.
EFE
“On the other hand, the Government’s finances have attracted attention in 2024, in the absence of agreement on the approval of the 2025 budget and the discussions of a tax reform to ensure the necessary resources. Furthermore, the proposal in Congress to reform the General Participation System increases long-term fiscal uncertainty,” they highlighted.
With all of the above, the Scotiabank experts closed by saying that the most important thing is to maintain close monitoring of the behavior of the markets and the economy, since although they do not rule out improvements in the short term, there are still several factors that generate stress among investors and should be carefully reviewed going forward.
