The dollar ended this Monday with an average price of $4,314 and fell $81 compared to the close of the previous day. In this way, The US currency has adjusted four consecutive falls since last July 13, the day on which it finished at $4,558.
The date on which the drop began, everything seemed to indicate that the upward path would continue, since the United States Government reported that, for June, the cost of living (technically called inflation) reached 9.1% in that country, a peak not seen for 40 years.
Preliminarily, this suggested that the Federal Reserve (a counterpart of Banco de la República) might continue raising interest rates to cool down the prices of goods and services. That would make investors continue taking their dollars to that country looking for a better return in exchange for lending them to the government and companies, something that would push up the value of the currency in Colombia.
Nevertheless, the analysts consulted by this newspaper explained that the markets already took this inflation data for granted in the US and that is why the rally observed between June 17 ($3,912) and July 12 ($4,627) arose..
On the other hand, they specified that the majority of investors project that The cost of living in the US would have already peaked and that would moderate the rise in rates by the Federal Reserve, a hypothesis that for now calms the market.
For Gregorio Gandini, a financial market analyst, the dollar is undergoing a normal correction: “Investors are guiding us, who have seen it at its highest and what we are seeing is profit-taking, they are taking advantage of it to sell. In addition, the demand has also dropped a bit because with the current prices they think if it is worth buying or not.”
For now, according to analysts, investors will be attentive to the speeches of the monetary authority in the US and what they can hear regarding interest rates will have an impact going forward.
An equity analyst stated that it is difficult to predict the behavior of the dollar. However, from his point of view, factors such as the international price of oil and the messages sent by the incoming government on tax reform and oil policy will have an influence.