The price of the dollar in Colombia ended the second business day of this week succumbing to the pressures of both internal and external markets which led it to trade below 4,000 pesos and returning to the levels seen in the middle of last year, when the US currency was trading at 3,909 pesos. This upward movement of the peso made the Colombian currency one of the most valued in the world.
(Also read: Dollar is already trading at less than 4,000 pesos and maintains its downward behavior)
From the first minutes of the session on Tuesday, the US currency began losing ground against the peso and only half an hour after the day’s exchange operations began, the dollar was already traded at 3,978 pesos. However, the rate achieved a decrease to 3,971.1 pesos, considered the minimum of the day.
The maximum price failed to exceed 4,012 pesos, more than 57 pesos below the current TRM for this day of 4,069.39 pesos.
With this behavior, the TRM for tomorrow, Wednesday, will be around 3,990 pesos, a level that has not been seen since mid-June of last year, when the currency was traded around 3,909 pesos.
(You may also be interested in: Dollar is trading again at a price that has not been seen for almost 13 months)
So far this year the currency has lost 820 pesos, indicating that the Colombian currency has strengthened by 17 percent.
After breaking the barrier of 4,000 pesos, the currency leading the advances in Latin America, driven by the entry of the country into the country, increasing the supply and weakening its price.
perspectives
Some market analysts consulted considering that the value of the dollar in the Colombian market is still well above its fair value (between 300 and 400 pesos), with which there is still room for the value of the currency to fall a little more. .
For Juan David Ballén, director of Analysis and Strategy of the brokerage firm Casa de Bolsa, points out that the US currency is trading between 300 and 400 pesos above its fair level.
“The fact that the Fed (central bank of the United States) is near the end of the cycle of rate increases would put a ceiling on the dollar globally. On the other hand, if the probability of a recession in the United States continues to decrease and the local government suspends or approves reforms that have low fiscal costs, the dollar could continue to fall, “explains the analyst.
The upward escalation of the dollar began in the middle of last year just as the country defined who would take the reins of the country in a second electoral round.
The dollar jumped from the 3,706.9 pesos registered in April 2022 to the all-time high of 5,061.2 pesos reached on November 11 of that same year.
For Felipe Campos, Strategy and Investment Manager at Grupo Alianza, it is increasingly likely that Colombia will return to the levels of 3,860 and 3,890 pesos in exchange terms.
The analyst explains that In the world, the currencies that are relevant to Colombia are trying to go to the minimum levels that existed before the global inflation shock, which means that most currencies are trying to go up to 3,400 pesos.
“Colombia had, in addition to the inflation shock, an internal (political) uncertainty that is barely discounting, it is in a different cycle than the rest of the world that is seeking to erase the inflationary shock,” explains Campos, who also adds that under that circumstance the country is trying to relocate to 3,800 pesos, which means that it is still 500 pesos above, so it still has room to fall further.
