Argentina’s peso currency fell 1.42% to a record low close of 30.92 per dollar on Friday, weighed down by an economy slipping into recession, high inflation and uncertainty driven by corruption investigations.
The US dollar climbed to 584 Chilean Pesos at the end of trading in the Santiago money market, signaling a slow but steady increase for several months now and with prospects of continuing according to analysts. A greenback at 600 Pesos is not far away according to market analysts.
Chilean authorities are feeling calmer with the exchange rate nearing 480 pesos per US dollar, Finance Minister Felipe Larrain said on Tuesday, as the currency retreated from the year-and-a-half highs it reached earlier this month.
Economic activity in Chile grew 4.7% in December from the year earlier on gains in the service and retail industries, and ended the twelve months of 2012 with an expansion of 5.5% over the previous year according to Central bank data.
Chilean inflation accelerated in February fuelled by transport and food costs, reinforcing expectations the central bank will hold its key interest rate steady next week.
Chile’s peso posted its biggest monthly drop since Lehman Brothers Holdings Inc. collapsed as a slump in copper dimmed trade prospects for the metal’s biggest producer. The peso sank 1.3% to 519.75 per US dollar on Friday.
The Chilean central bank announced Tuesday it would maintain the pace of a 12 billion US dollars foreign exchange intervention to tame the strong peso between Feb. 9 and March 8, and continue to buy 50 million of US currency daily.
Chile's peso was operating Thursday at 495 to the US dollar after depreciating around 6% in two sessions on a 12 billion US dollars central bank intervention program announced this week.
The US dollar ended 2010 at a record low vis-à-vis the Chilean peso which has soared on the strong global demand for copper, the country’s main export. On Friday December 31st the US dollar was operating at 467.30 and 467.80 in Santiago’s money markets, which is the lowest since May 19, 3008 with 467.40.