Colombia’s Peso Gains From 2011 Low on Eased U.S. Growth Concern

Colombia’s peso rose from its lowest level this year after reports on U.S. jobs growth and service industries topped estimates, tempering concern about an economic slowdown in the world’s biggest economy.

The peso rose for the first day in six, jumping 1.2 percent to 1,961.10 per U.S. dollar at 2:26 p.m. New York time, from 1,984.60 yesterday. Yesterday’s closing price was its weakest level since Dec. 28.

“The numbers coming out of the U.S. are motivating local investors to come into the market and buy,” said Daniel Lozano, an analyst at Serfinco SA brokerage in Bogota.

The Institute for Supply Management’s index of non- manufacturing businesses decreased to 53 in September from 53.3 a month earlier, and above the median estimate for a drop to 52.8 in a Bloomberg survey. 

A reading above 50 signals expansion. Separately, ADP Employer Services said companies in the U.S. added 91,000 jobs in September, more than the median forecast for a 75,000 increase.

The yield on Colombia’s benchmark 10 percent bonds due in July 2024 fell six basis points, or 0.06 percentage point, to 7.64 percent. 

The bond’s price rose 0.523 centavo to 118.778 centavos per peso.

Colombia’s domestic economy shows a “very clear” need for higher interest rates, central bank director Cesar Vallejo said in an interview yesterday. 

Banco de la Republica left its overnight lending rate unchanged at 4.5 percent in its last two policy meetings since the effects of the global financial crisis on Colombia are unpredictable, Vallejo said.

Colombia’s consumer prices were little changed in September, rising 0.02 percent from the previous month after declining 0.03 percent in August, according to the median estimate of 30 economists. 

The national statistics agency is slated to publish the monthly inflation report at 8 p.m. New York time.