Dollar rises this week due to political noise over default proposals

Dollar rising this week
Dollar rising this week.

The dollar touched the barrier of $3,900 pesos this week due to political noise over proposals such as not paying the bonds and TES of the Colombian State.

Ricardo Bonilla, Minister of Finance, pointed out that the debt quota project was filed on May 19.

Bonilla said that the Duque government spent more than 6.5 billion on loans that were outside the quota. Now they would seek to heal the state’s finances and meet payments.

Colombian peso affected by rumors of defaults

This political noise from the opponents echoed among institutional investors and rating agencies, increasing Colombia’s country risk.

USDCOP ended Friday, May 24, 2024, $7.0 above Thursday’s close, after a bullish day.

In the first minutes of the session, the peso registered some downward movements, then headed towards depreciation, such that it broke the $3,900 barrier; however, ended at $3,875.

In the absence of relevant economic news, the main currencies of the region operated mixed due to the caution of investors who are trying to determine the moment of a first rate cut by the FED, after the latest economic data in the US. USA

“In the local context, the markets reacted to the statements of different government officials about the importance of the bill that seeks to increase the nominal quota of the country’s external debt,” stated the Bancolombia Group.

The Reuters news agency noted: “The Colombian peso (USDCOP) reversed the trend of the first hours of the day and closed with a fall of 0.18% to 3,875 units per dollar, while the stock index of the local stock market, the MSCI COLCAP (COLCAP), rose 0.10% to 1,407.76 points.”

On the Colombian Stock Exchange (BVC), the shares of PEI +25.2% and Conconcreto +9.3% were the protagonists this week. On the last day, Canacol surprised with a slight rebound.

Will the dollar rise next week or will the messages calm the market?

Read more: PEI rises +17.44% after entering the MSCI COLCAP.

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