Bloomberg News

Chilean Peso Climbs for Fifth Straight Day as Copper Rallies

June 30, 2011

June 30 (Bloomberg) -- Chile’s peso strengthened for a fifth straight day as rising copper prices bolstered trade prospects in the metal’s top-producing nation, and speculation that Greece will avoid a default on its debt increased demand for riskier emerging-market assets.

The peso advanced 0.5 percent to 467.22 per U.S. dollar at 2 p.m. New York time, from 469.73 yesterday. The currency decreased 0.5 percent in June.

“As copper rises, the peso will continue pushing forward, especially if other drivers are promising,” Mauricio Olivares, a senior currency trader at Scotiabank Sud Americano in Santiago, said in a telephone interview. “The imminent bailout in Greece has also helped the peso’s strong showing.”

Copper, which accounts for half of Chile’s exports, gained as much as 1.5 percent today in New York, reaching the highest price since April 28.

Greek lawmakers backed a bill to authorize implementation of the government’s 78 billion-euro ($113 billion) package of budget cuts and state asset sales.

Approval of the bill was needed before the cash-strapped nation can tap a fifth loan payment from last year’s 110 billion-euro rescue by the European Union and International Monetary Fund.

Chile’s central bank paid an average of 468.56 pesos per U.S. dollar for $50 million as part of a $12 billion effort to limit the peso’s gains, according to data posted on the bank’s website.

--With assistance from Eduardo Thomson in Santiago. Editors: Richard Richtmyer, Glenn J. Kalinoski

To contact the reporter on this story: Bryan Gibel in New York at bgibel@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net


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