The dollar was traded on average in Colombia, this Monday, April 25, at 3.932,62 pesos, 113.55 pesos more than the TRM of the day, which was 3,819.07 pesos.
The US currency did not exceed 3,900 pesos in the country since March 2, 2022.
But, What was the reason for such a strong increase?
(Vea: The Attorney General’s Office asks to overturn the reform that suspended the Law of Guarantees).
Camilo Durán, senior economist at Credicorp Capital, recalled that the upward movement of the dollar is taking place from the week of April 18 to 22 and that the depreciation of the Colombian peso has been one of the strongest.
According to Durán, these movements are just an example of a global behavior that the dollar has had during 2022.
“The dollar has been strong for a long time once morest powerful currencies such as the euro and the yen, and Latin America was the exception, but it is already being felt in the region”, he explained.
(Vea: 46.7% of Colombian households are considered poor).
“Almost all this year there has been a buying flow in the region, both in terms of financial flow and real flow, and that supported the currencies: the Colombian peso, the Brazilian real. This behavior responded to the significant price change in raw materials”, he added.
So what happened, why the strengthening of the dollar.
Duran argued that the high demand has happened for him context of global economic growth: “2021 was satisfactory and in this 2022 we entered a very strong slowdown. And in a slowdown scenario, and if it is pronounced, the demand for dollars tends to increase significantly, which was already happening throughout the world except in Latin America.”.
(Vea: National Development Plan already reaches 75% execution).
The expert valued that this deceleration has been registered “due to the inflationary pressures that have materialized, due to the absence of fiscal spending stimulus by governments and, more recently, due to the adjustment of interest rates and monetary policies in general”.
In the case of Colombia, he said, the presidential election that are approaching (next May 29).
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