Colombia's peso hits over one-month high, lifting LatAm currencies
SPY•Colombia's peso rose 0.54% to 3,150.25 per dollar, its highest level since September 17, after a central banker said rates may need to stay higher for longer. Latin American currencies gained 0.45%, while Brazil's real rose 0.3% as investors watched a close presidential runoff race.
1. Colombian peso advances
The Colombian peso strengthened 0.54% to 3,150.25 per dollar on Monday, reaching its highest level in more than a month. Central bank policymaker Laura Moisa said late Friday that inflation was mainly driven by supply-side shocks and interest rates would have to remain high for longer. HSBC analysts said recent peso weakness may have run its course, citing local support and attractive carry conditions.
2. Regional currencies rise
MSCI's index tracking Latin American currencies gained 0.45%. Mexico's peso rose 0.26% and Chile's peso strengthened 0.38%. Strong Chinese growth data also boosted risk sentiment, with China a major importer of Latin American resources.
3. Brazil election in focus
Brazil's real rose 0.3% to 5.0469 per dollar as two polls showed Senator Flavio Bolsonaro's lead over President Luiz Inacio Lula da Silva had narrowed ahead of their runoff. Brazil's equity benchmark was nearly flat, while Petrobras fell 2.6% and Argentina's YPF dropped 2.4%.
