MercoPress. South Atlantic News Agency

Chile's Peso gains against U.S. Dollar

Chile's peso rose against the dollar as higher prices for copper, the country's top export, and faster growth than Latin America's largest economies boosts inflows.

Chile's economy grew in the first quarter at more than twice the pace of that of Mexico, Latin America's largest economy, according to figures reported yesterday by the Chilean central bank.

''On average, economic growth is high compared to the rest of the world,'' said Julio Espinoza, an analyst at brokerage BICE Corredores de Bolsa in Santiago. ''That kind of economic growth attracts capital.''

Chile's economy grew 5.7 percent in the first quarter from a year earlier, compared with 2.4 percent growth in Mexico. The government of Brazil, Latin America's second-largest economy, today cut its estimate for economic growth for the year to 4 percent from 4.32 percent.

Growth in Chile slowed from 7.3 percent year-on-year in the fourth quarter. Still, the expansion last quarter surpassed 5.5 percent growth forecast by Chile's central bank on May 18.

The faster-than-expected expansion in South America's No. 5 economy, coupled with declining prices for imported oil and rising prices for copper, Chile's biggest export, will sustain demand for the peso today, said analysts such as Flavia Cattan-Naslausky at Royal Bank of Scotland Plc.

Elsewhere in the region, Brazil's real reversed declined to trade little changed at 2.4260 per dollar from 2.4259 per dollar late yesterday. The currency yesterday reached 2.4237 per dollar, its strongest since trading at 2.4235 on May 8, 2002.

Brazil's benchmark bond rose for a fifth day, adding 0.15 cent on the dollar to 116.20, paring the yield to 9.41 percent, according to JPMorgan Chase & Co.

Mexico's peso fell 0.1 percent to 10.9706 per dollar, Colombia's peso fell 0.3 percent to 2,331.45 per dollar and Argentina's peso was little changed at 2.8855 per dollar.