Bloomberg News

Chilean Peso Gains as Chinese Factory Data Boost Growth Outlook

October 24, 2012

The Chilean peso strengthened on signs that China’s manufacturing is shrinking at a slower pace, easing concern about the outlook for global economic growth.

The peso strengthened 0.2 percent to 481.63 per U.S. dollar at the close of trading in Santiago, ending a four-day losing streak. It fell 1.2 percent yesterday, the most since June.

“The peso is slightly up because markets outside are slightly up,” Ronald Volpi, head of spot currency trading at EuroAmerica Corredores de Bolsa SA, said in a phone interview.

U.S. stocks advanced after data showed purchases of new homes rose in September to a two-year high. The preliminary reading for a private purchasing managers’ index in China was 49.1, compared with a final reading of 47.9 last month. Figures above 50 indicate expansion.

The peso, which has rallied 7.9 percent against the dollar this year, is forecast to trade at 480 in three months, according to economist and trader surveys published today by the central bank.

The monetary-policy rate will be held steady at 5 percent for at least two years, while inflation will reach 2.9 percent in a year and 3 percent in two years, according to the surveys.

To contact the reporter on this story: Eduardo Thomson in Santiago at ethomson1@bloomberg.net

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


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