Colombia Peso Gains as Faster Growth, U.S. Optimism Boost Demand

Colombia’s peso gained as speculation the U.S. economy will continue to recover and higher than forecast third quarter growth in the South American country helped boost demand for the nation’s financial assets.

The peso rose 0.2 percent to 1,922.5 per U.S. dollar in the next-day market at 11:52 a.m. in Bogotá, according to the stock exchange’s foreign-exchange electronic transactions system, known as SET-FX. 

With markets closed in the U.S., Colombia’s currency trades in the so-called next-day market, in which payment and delivery are made the following trading day.

“Investors have kept the optimism brought on by last week’s good news,” said Daniel Velandia, head of research at Bogota-based brokerage Correval SA. 

Trading volume is low today in Colombian markets given the U.S. holiday, he said.

Orders for U.S. durable goods rose in November by 3.8 percent, the most in four months, and more than the 2.2 percent economists had predicted, data from the Commerce Department showed Dec. 23 in Washington. 

A report last week showed sales of new U.S. homes rose 1.6 percent to a 315,000 annual pace in November, a seven-month high. 

The U.S. is Colombia’s biggest trading partner, buying about 40 percent of the South American nation’s exports.

Colombia’s economy expanded 7.7 percent in the third quarter from a year earlier, the national statistics agency said in a Dec. 22 report. 

The growth exceeded the estimates of all 30 economists surveyed by Bloomberg, whose median forecast was for an increase of 6 percent.

The yield on the nation’s 10 percent bonds due in July 2.024 fell one basis point, or 0.01 percentage point, to 7.64 percent, according to the stock exchange. 

The bond’s price rose 0.037 centavo to 118.561 centavos per peso.