Inc Dollar

David Duarte, analista de 4CAST Inc., in New York coincided with Cardenas saying: the trend is towards the appreciation, assuming that the risk aversion continues its gradual decline. In part by the weakening of the dollar and partly by the initial flow of capital into the region, Latin American currencies have already begun to be appreciated in so far this year. The most pronounced appreciation occurred with the Brazilian real which went from quote to 2,313 reais in late 2008 to R $ 1,864 in these moments. The Chilean peso turned out to be the second coin that stronger appreciated (from $638,16 to $540,25), mainly of the copper price recovery product. The Colombian peso, which rose from $2.247,19 per dollar to $2.032,52 per unit of American currency appears in third place. Only the Argentine peso depreciated so far of the year against the dollar American and this behaviour responds to doubts that it generates among investors its economy, which was reflected in a permanent capital flight. In the case of the Bolivar fuerte in Venezuela, the depreciation observed in the parallel market outperforms the Argentine peso and the Venezuelan currency is exchanged to 6.95 units per dollar when at beginning of year did 5.7 units by the U.S.

currency. The appreciation observed so far by the majority of Latin American currencies can make thinking that too much scope there is so that they continue to strengthen against the dollar. This hypothesis is quite far from reality since the contributions of Latin American currencies are far removed from highs that knew how to reach by mid-2008. The recovery of the region’s economies and capital inflows are the main foundations to bet for the continuity of the appreciation of these currencies. On what coins probably observe higher assessments in the region in what’s left of the year, I bet on the real, the new Sun and the Chilean peso.

The Brazilian currency, might be expected to close the year by 1.70 reais although it will depend on the force with which the Central Bank of Brazil to intervene in the currency market. So far it has been able to do so without generating inflationary pressures, but as the economy recovers, the margin of intervention will be reduced. In the case of the Peruvian nuevo sol, your quote may reach 2.8 to 2.85 units per dollar towards the end of the year, while the Chilean peso can be expected, depending on how you follow the Central Bank’s monetary policy and the price of copper, which close 2009 between $510 to $520 per U.S. dollar. The peso also shows appreciation prospects, although his picture is not so clear in the light of the turbulence in bilateral relations with Venezuela. On the Argentine peso and the Bolivar fuerte, I have no doubt that both currencies will continue depreciating. You no longer have too many doubts about the Argentine peso will end the year above the $4 (even some bet on a weight to 4, 4-4, 6 units per dollar by end of year). In the case of the Bolivar fuerte, although the official quote will not fail to observe a weakening (although increasingly suffer from higher pressures to make it), yes your parallel quote continue to do so. The panorama of Latin American currencies is shown pretty clear for the remainder of the year. We must invest in Latin American currencies.

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