Price of the dollar exceeded $4,600 again, but has lost $146.78 so far in 2023

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The volatility of the currency will continue due to national and international factors, among which are the economic policy messages of the Government of Gustavo Petro and the rise in US Federal Reserve (FED) interest rates

By

Sergio Rodríguez

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The dollar registered maximums in Colombia during the last months. Reuters/Dado Ruvic/Illustration

The price of the dollar exceeded 4,600 pesos again on February 3. At the end of the day, it was located, on average, at 4,669.46 pesos, which represents an increase of 85.02 pesos compared to the Representative Market Rate (TRM), which stood at 4,584 44 pesos.

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Álvaro Uribe criticizes the increases in interest rates: “We see the citizens in panic” The leader of the Democratic Center predicted that with the decision there will be an impact on employment and on the portfolios of banks, “because citizens will not be able to comply with their debts”

SEE NOTE

The currency had an opening price of 4,610 pesos. The maximum value at which the dollar was traded was 4,711 pesos, while the minimum was 4,605. According to the Set-FX platform, 1,236 million dollars were traded on this day in 1,909 transactions.

When closing the first week of January, it can be seen that the dollar has lost 146.78 pesos, since the beginning of the year, when it was at 4,816.24 pesos on January 2, until February 3, when it was at 4,669.46 pesos.

Price of the dollar exceeded $4,600 again, but has lost $146.78 so far in 2023

Dollar strengthens by the second consecutive day and it is trading again above $4,600 Gustavo Petro's messages on the regulation of public services, the call from the Attorney General's Office to Minister Irene Vélez for the report on gas reserves and this week's meeting of the FED would have affected the new rise in the US currency

SEE NOTE

The volatility The dollar will continue due to national and international factors, among which are the economic policy messages of the government of Gustavo Petro and the rise in interest rates of the Federal Reserve of the United States (FED), which make the Banco de la República de Colombia do the same in order to impact inflation and prevent the indebtedness.

Below you can see how the price of the dollar has changed so far in 2023:

Price of the dollar exceeded $4,600 again, but has lost $146.78 so far in 2023

Inflation in January would continue above historical records, say specialists

Price of the dollar exceeded $4,600 again, but has lost $146.78 so far in 2023

Estimates maintain the rate of inflation above that presented during 2022. Reductions would be seen until the second semester of 2023.

On February 4, the first report of the Consumer Price Index will be released, that is, the rate of inflation, published by the National Administrative Department of Statistics (DANE), and that according to the estimations of experts and analysts, the figure will continue above the historical maximums. This also means that the estimate for rate reductions will not begin to be noticed, so expectations are already set for the second semester.

Dollar price topped $4,600 again, but has lost $146.78 so far in 2023

The price of the dollar fell again after three days on the rise and closed at an average of $4,638.88 The Federal Reserve began to slow down the interest rate hikes by raising only 0.25 basis points at the meeting on Wednesday, January 1. February

SEE NOTE

In fact, the outlook for inflation has already worsened for the Banco de la República, which by the end of 2022 expected that the referral fees will begin to decreasewith the beginning of 2023, which made him think that the increases would also have a reduction.

In the most recent report on Monetary Policy they already estimate that the inflation closes above the target, which suggests that interest rates will also maintain their upward trend:

“The inflation forecast for 2023 was raised compared to the October Report from 7.1% to 8.7%. For 2024, the forecast did not change (3.5%) and inflation would approach the target due to the response of monetary policy. All of this is compatible with the announcement made by the JDBR in November 2022 (…) The annual variation in food prices would take a downward path in the first quarter of 2023 and drop rapidly. In contrast, the variation in regulated prices would remain high in 2023″.

All of this leads the issuer to think that the slowdown in the economy is much more noticeable. > During 2023, however, they remain optimistic and expect positive numbers to continue, a margin that would be between 0.2% and 1 percent.

There are national factors that directly already generate alarm due to possible increases in prices. The most significant could be the landslide on the Pan-American Highway, near the municipality of Rosas, in the department of Cauca, which in addition to shortage of supplies to the southwest of the country, has prevented the removal of the products that are generated in this region.

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