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Dollar vs Peso Exchange Rate

Note: Central bank unable to control the fall of the dollar...vs the Colombian peso.

Colombia Peso Rises to 6-Year High on Outlook on Dollar Inflows

By Andrea Jaramillo

March 12 (Bloomberg) -- Colombia's peso rose to a six-year high on expectations the sale of the nation's largest steelmaker will boost dollar inflows into the country.

Shareholders of Acerias Paz del Rio SA, including company workers and the government's Industrial Promotion Institute, are scheduled to auction 52 percent of the steelmaker on March 16. Shareholders are seeking to raise at least 425.9 billion pesos ($193 million) from the transaction, the government's bank- deposit guarantee fund said in a Dec. 11 statement.

``The sale of the steelmaker will likely lead to an important inflow of dollars, helping maintain the currency's strengthening trend,'' said Juan Carlos Nino, Bogota-based head of Banco Agrario's money-market trading desk.

Colombia's peso strengthened for a fifth day, gaining 0.3 percent to 2,204.26 pesos to the dollar at 4:53 p.m. in New York, its highest close since Dec. 27, 2000. The currency has rallied 9.1 percent in the past six months, the fourth-best performance among 70 currencies Bloomberg News tracks.

Banco de la Republica purchased $1 billion in the foreign exchange market in February, the bank said in a statement today, adding to the $1 billion it bought a month earlier to slow the peso's rally.

The central bank has less leeway to stem the peso's gain as this may add to inflationary pressures, according to Nino.

http://www.bloomberg.com/apps/news?pid=20601086&sid=a6WDj3Wz_2ZE&refer=news

By elk on Mar 17, 2007, 04:38 in Friendly Talkzone.

Brians says on Mar 17, 2007, 06:24:

Tell me about I feel like the CP is the only currency still based on the Gold Standard:) I have one month to make a wire and everything was playing the way I thought except I thought the CP would be a lot higher. It is interesting how strong it is in light of the fears of a global slowdown. Oh well.

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poco says on Mar 17, 2007, 07:26:

Nice thought I thought the CP would be a lot higher.

Cheer up you could have DOLLARS inside Colombia and need pesos and that rate is even lower.

There are a lot of bank foreclosure condos in Bogota. Maybe they are 50% less than the price 4 years ago?

The good part,,,,, I can still buy a nice BIG soft loaf of thick sliced wheat bread for 89 cents in the U.S. Bad part is that peanut butter is higher. I can thank my lucky stars that peanuts aren't being used to make biofuel or I'd need a loan.

I may need to pack a few loafs when I return.

"Violence is the first refuge of the incompetent" - Isaac Asimov

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Waterdawg says on Mar 17, 2007, 07:32:

Foreclosures ??? There are a lot of bank foreclosure condos in Bogota. Maybe they are 50% less than the price 4 years ago?

And what bank or banks are siting on these ????////

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aztec says on Mar 17, 2007, 07:52:

poco "There are a lot of bank foreclosure condos in Bogota. Maybe they are 50% less than the price 4 years ago?"

If you have any inside knowledge on this some of would like to take advantage of it.

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poco says on Mar 17, 2007, 08:06:

There are foreclosures all over Colombia This is common. One of the construction guys we know was fixing up 4 condos in Bogota that had been purchased from a bank. His family purchased another in the last several weeks. The condos were located in an estrato 4 building.

Two years ago Armenia had quite a few "houses" in the 2 and 3 neighborhoods. Houses (not condos) were "cheaper" than the small town where I live. This is saying something because Armenia costs are normally and probably still are the highest in the Valle Cauca area.

The four units cost 24 Million pesos each. Maybe 3 to 5 million fixup.

"Violence is the first refuge of the incompetent" - Isaac Asimov

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