Bloomberg News

Peru’s Sol Falls to One-Week Low on European Summit Pessimism

October 20, 2011

Oct. 20 (Bloomberg) -- Peru’s sol fell to the lowest in a week as concern European leaders will struggle to agree on a solution to the region’s debt crisis at a summit this weekend hurt demand for higher-yielding emerging-market assets.

The sol earlier fell to 2.7285 per U.S. dollar, its lowest level since Oct. 13. It closed little changed at 2.7245, from 2.7235 yesterday.

“Uncertainty regarding Europe is the common driver in Latin American currencies today,” said Hugo Perea, chief economist at BBVA Banco Continental in Lima.

German Chancellor Angela Merkel canceled a planned speech to parliament tomorrow because of a deadlock over proposals to leverage the European Financial Stability Facility, three German lawmakers said.

The yield on the government’s benchmark 7.84 percent sol- denominated bond due August 2020 rose one basis point, or 0.01 percentage point, to 5.74 percent, according to prices compiled by Bloomberg. The bond’s price fell 0.06 centimo to 114.30 centimos per sol.

--Editor: Marie-France Han

To contact the reporter on this story: Andrea Jaramillo in Bogota at ajaramillo1@bloomberg.net

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


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