Colombia’s peso rose for a second day as companies bought the currency before local tax payments due in June and U.S. consumer confidence rose to the highest level since 2007, supporting higher-yielding assets.
The peso erased an earlier decline, rising 0.5 percent to 1,832.70 per U.S. dollar after earlier touching 1,851.25 and approaching the four-month low of 1,853.95 reached May 23.
“Companies bringing in dollars to pay for taxes is something that will help the peso amid all the volatility” in global markets, said Juan Camilo Santana, an analyst at Cia. de Profesionales de Bolsa SA brokerage in Bogota. Companies are scheduled to pay taxes between June 8 and June 25.
The yield on the country’s 10 percent peso-denominated debt due in July 2024 fell three basis points, or 0.03 percentage point, to 7.16 percent, according to the central bank. The price rose 0.226 centavo to 122.476 centavos per peso.
The peso fell earlier today as concern Spain’s regional governments are having trouble with finances fueled speculation Europe’s credit crisis is getting worse. Catalan President Artur Mas repeated at a briefing with reporters today in Madrid his call for Spain’s central government to aid regions.
The currency fell for a third straight week, declining 0.5 percent, paring its rally this year to 5.8 percent. The currency is still the second-best performer after the Madagascar ariary among all counterparts tracked by Bloomberg.
The Thomson Reuters/University of Michigan final index of U.S. sentiment climbed to 79.3 in the ninth straight increase from 76.4 in the prior month, according to a report today. The gauge was projected to hold at the preliminary reading of 77.8, according to the median forecast of economists in a Bloomberg News survey.
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