Feb. 22 (Bloomberg) -- Peru’s sol held near a three-year high as the country’s metal exporters bought the currency to pay local taxes and amid rising investment inflows to the country.
The sol was little changed at 2.68 per U.S. dollar at the close of trading in Lima, according to Deutsche Bank AG’s local unit. The currency yesterday touched 2.679, its highest intraday level since at least December 2008.
The central bank purchased $133 million in the foreign exchange market today and has bought $1.95 billion so far this month to stem gains in the sol. It paid an average 2.68 soles per dollar today, the bank said on its website.
“The structural supply of dollars in the first quarter makes the sol immune to bad news abroad,” said Gonzalo Navarro, head trader at Banco Santander in Lima.
While foreign investment flows and companies bringing in dollars to pay taxes for March push gains in the sol, the central bank’s dollar purchases are easing the strengthening trend, according to Navarro. He forecasts the sol will gain to 2.665 by the end of March.
The yield on the nation’s benchmark 7.84 percent sol- denominated bond due August 2020 fell one basis point, or 0.01 percentage point, to 5.55 percent, according to prices compiled by Bloomberg. The price rose 0.09 centimo to 115.31 centimos per sol.
--Editors: Richard Richtmyer, Glenn J. Kalinoski
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