Already a Bloomberg.com user?
Sign in with the same account.
Chile’s peso gained the most among major Latin American currencies as speculation that authorities will act to halt a deepening of the euro-zone crisis eased concern over slowing demand for Chile’s commodity exports.
The peso appreciated 0.9 percent to 507.53 per U.S. dollar as of 11:42 a.m. in Santiago, extending a recovery from the four-month low reached on June 1. The Bloomberg JPMorgan Latin American Currency Index rose 0.6 percent.
The European Central Bank is ready to act and some policy makers favor lowering rates, its president Mario Draghi told reporters in Frankfurt today after the bank left the benchmark rate unchanged at 1 percent. Copper, which accounts for more than half of Chile’s exports, rebounded from the longest slump since February.
“The market was prepared for a catastrophe in Europe,” said Eugenio Cortes, head of currency forwards at EuroAmerica Corredores de Bolsa SA in Santiago. “People were overbought in dollars. Now there’s a sensation that the ECB has to do something and people are reducing their long dollar positions.”
Copper futures for July delivery climbed 1.9 percent to $3.3525 a pound on the Comex in New York. Prices dropped 5 percent over the previous five sessions in the longest slide since Feb. 17.
International investors in the Chilean peso forwards market had a $10.2 billion long dollar position against the peso on June 4, just shy of the record reached on May 24. Local investors, mostly pension funds, had a $17.7 billion long peso position, according to data published today by the central bank.
To contact the reporter on this story: Sebastian Boyd in Santiago at email@example.com
To contact the editor responsible for this story: David Papadopoulos at firstname.lastname@example.org