Dollar in Colombia Returns to the 3,300-Peso Level and Hits Levels Not Seen Since July

The Colombian peso exhibited signs of strengthening against the US dollar on Thursday, September 24, closing at 3,328.45 pesos per dollar, a 64.06 peso rise from the previous day's Representative Market Rate of 3,264.39 pesos. This indicates the dollar had touched the 3,300-peso threshold and reached levels not observed since July.

The previous day's closing price was 3,264.40 pesos, with intraday fluctuations between 3,215 and 3,317 pesos. Mauricio Acevedo, a foreign exchange strategist at Corficolombiana, attributed the market's volatility to investor adjustments following the US 10-year Treasury yield surpassing the 5% mark, reflecting concerns over the Federal Reserve's aggressive stance.

Analysts anticipate a 78% probability of a rate hike in October and over a 58% chance of another increase in December, which has prompted bond yields to rise and negatively impacted major stock market indexes, particularly the technology sector. Rodrigo Lama, CEO of Global66, a Latin American fintech company, noted that geopolitics is currently the focus of attention, with the Fed's recent actions drawing significant scrutiny.

The upcoming UN General Assembly and the meeting between Trump and Xi Jinping are seen as potential catalysts for asset movements, with oil and the dollar acting as key indicators. Analysts predict a potential appreciation of the Colombian peso against the US dollar and a return of the exchange rate to between 3,100 and 3,140 pesos, contingent upon positive developments in the US-China negotiations and reduced tensions in the Middle East.

Should oil prices exceed 100 dollars per barrel, the US dollar could strengthen, leading to a decline in emerging-market currencies.