The price of the dollar continues to fill Colombians with uncertainty. Wednesday 29th June touched a new record for this year 2022.
The Set-FX platform, the country’s official currency source and a subsidiary of the Columbia Stock Exchange (BVC), indicated that the exchange rate reached $4,148.50, after it started declining compared to the previous close. This number is higher than the figure recorded last Friday, when it reached 4,146 dollars, the maximum for 2022 so far.
Thus, the value of the US currency in Colombia became only 5.41 dollars from reaching the historical maximum in the country, which is 4,153.91 dollars and was recorded in March 2020, precisely at the beginning of the spread of the Covid-19 epidemic and the announcement of restrictions in the country.
It is worth noting that when the market closed on Wednesday, the price of the coin settled at 4,117 USD, after the exchange announced an opening price of 4,090 USD and the minimum achieved was 4,080 pesos. Finally, the day closed at an average price of $4,128.59 pesos, which means it closed $38.87 above the representative day market price of $4,089.72.
On Tuesday, the US currency fell 37.69 pesos against today’s TRM ($4129.87) and closed at an average price of 4,092.18 pesos.
According to experts, international phenomena and market behavior, such as the oil market, are some of the conditions for understanding the dollar’s behavior today in Colombia.
The international influence is obvious
For example, the famous banker Luis Carlos Sarmiento explained to Semana that in the price of the dollar, at this moment, the international influence is very visible.
Sarmiento explained that the value of that currency has grown against the peso, because what is happening in the United States is not a common thing. He added that “the inflation rate is eight and a half percent, which is the highest rate in the past forty years in the United States. This is a circumstance capable of destabilizing the earth for anyone in other countries.”
Sarmiento, the richest man in Colombia, also offered his view on how close the United States is to facing a recession, something that would greatly affect currencies.
“It is not impossible because the authorities cannot allow inflation to continue to rise, and they will have to keep raising interest rates,” he told national media.
However, in his opinion the rate is already high. “The fear comes from the fact that it has reached its limit and that if they raise it further, it could have the undesirable effect of crippling the economy, and that would be a recession.”
This is what caused the market turmoil, Sarmiento explained. He added that the situation is not only affecting the exchange rate, but also the stock prices, which are at their lowest levels in the long run.
For the businessman, Gustavo Petro’s victory in the presidential election over Rodolfo Hernandez may add to this situation, but at the moment it is not the dominant reason for the rise of the dollar.
“Here in Colombia, the consequences were also being felt. The political influence may be increasing, but right now, if you ask me what I think is the dominant cause, it is certainly the global situation.”