MercoPress. South Atlantic News Agency

US dollar soars in Chile and closes trading at 612 pesos

With no end in sight for the global financial and confidence crisis, plus the price of commodities falling, the US dollar is breaking new records in Chile having closed trading on Wednesday at 612 Chilean pesos.

On Tuesday it was trading just below the 600 pesos benchmark, which represents an increase of 16.5 pesos in one day. This is the highest value of the greenback in Chile since November 2004. Only a few months ago the Chilean government had implemented a monetary calendar by which the Central Bank was involved in daily purchases of 50 million US dollars with the purpose of propping the US dollar to 500 pesos and pumping peso liquidity. So far this year the Chilean peso has lost 18.4% against the US dollar compared to an appreciation of 6.44% in 2007. Chilean financial authorities and the Central Bank are currently coordinating a mechanism to tender budget-surplus US dollars in the local credit market with the purpose of injecting dollar liquidity. Meantime copper, Chile's main export item and money maker continued on Wednesday to fall in the London Metal Exchange trading at its lowest since March 2006. On Wednesday copper closed at 2.497 US dollars the pound with a 4.08% loss compared to Tuesday (2.603 USD) and Monday (2.588 USD). This brings the October selling price average to 2.6845 USD and the annual average to USD 3.584 USD per pound for top grade copper.