Bloomberg News

Chile Peso Extends Biggest Emerging-Market Gain on Economic Data

January 07, 2013

Chile’s peso, the strongest emerging- market currency this year, rose to an 11-week high after economic activity expanded faster than forecast and the country posted its biggest trade surplus since April 2011.

The peso climbed 0.3 percent to 471.9 per U.S. dollar as of 10:26 a.m. in Santiago. It earlier touched 471.3 per dollar, the strongest since Oct. 17. The currency has appreciated 1.5 percent this month, more than any of the 24 other emerging- market currencies tracked by Bloomberg.

Economic activity grew 5.5 percent in November from a year earlier, the central bank said today, more than the 5.2 percent median forecast of 16 economists surveyed by Bloomberg. A separate report showed that Chile had a $1.5 billion trade balance on December, exceeding estimates for $200 million.

“The dollar is falling on local data,” said Ronald Volpi, the head of spot currency trading at EuroAmerica Corredores de Bolsa SA in Santiago. “We had good growth and excellent copper exports. We’re full of dollars.”

Chile exported $4.7 billion of copper in December, accounting for 61 percent of the country’s goods sent abroad, according to the central bank.

International investors in the Chilean peso forwards market had a $3.9 billion short peso position on Jan. 3, the smallest since November 2011. Local investors had a $14.1 billion long peso position, up from the 13-month low reached on Jan. 2

Chile’s one-year basis swap rate rose to a six-month high of 20 basis points today from 15 basis points on Jan. 4.

To contact the reporter on this story: Sebastian Boyd in Santiago at sboyd9@bloomberg.net

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


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