The Colombian Peso Y Uribe

Note: At least the president of Colombia is aware of the problem relating the fall of the U.S. dollar. (or strength of the Peso) Perhaps we will see some positive changes as the Colombian exports are effected.

Colombia's Uribe Seeks to Stop Speculative Capital (Update1)
By Andrea Jaramillo
May 1 (Bloomberg) -- Colombian President Alvaro Uribe called on the central bank to send investors a ``clear signal'' that it plans to stop ``speculative'' capital inflows that have helped send the peso to a seven-year high.

``Colombia gives all the guarantees to investment but Colombia can't allow speculation to hurt businesses and workers,'' Uribe told steel workers in Boyaca province today, according to a speech posted on the presidential Web site. ``We need to ask the central bank, without any fear, to adopt the measures to stop speculative capital.''

The comments mark the second time in three weeks that Uribe, 54, has urged central bankers to implement some type of capital controls to check the peso's four-year, 37 percent rally.

Uribe said on April 14 that the government was willing to coordinate with the central bank on a new reserve requirement on ``speculative'' investment. The Finance Ministry damped expectations that controls were imminent by saying in a statement on April 19 that it ``didn't deem convenient'' the imposition of capital controls.

The peso has surged 6.4 percent against the dollar this year, buoyed by rising foreign investment in an economy growing at its fastest pace in three decades. The peso rose 0.5 percent yesterday to 2,100.29 per dollar, its highest since June 2000. Colombian financial markets are closed today for Labor Day.

Colombia scrapped last year a requirement forcing foreign investors to keep their money in the country for at least a year. The government implemented the measure in December 2004 as part of an effort to curb the peso's rally in the peso, which is eroding exporters' profit margins.

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

By elk on May 2, 2007, 07:37 in Friendly Talkzone.

Man Tequila says on May 2, 2007, 08:30:

I'm inclined to agree with Tinto. At least Uribe is aware of the problem, as elk says. But the Central Bank will have their work cut out for them.

Aunque no me creas/ si me lo propongo/ lograre olvidarte/ porque a fin de cuentas/ no soy tan cobarde./ Y termino todo una de estas tardes/ no sera dificil buscar algún sitio donde refugiarme/ donde nunca mas vuelvas a encontrarme. (Polo Montañez)

0 funny, 0 helpful.