The US dollar loses ground against the Colombian peso for the eighth consecutive day, falling to Twenty-day lows at 4,003.20 after testing a daily high at 4,030.20.
USD/COP is trading at 4,009.38 at the time of writing, losing 0.18% on the day.
Colombia’s GDP grows 2.1% annually in the second quarter of the year
- He Colombia’s gross domestic product grew 2.1% year-on-year in the second quarter of the year after rising 0.7% in the first three months of 2024. This is the most significant growth recorded in the Colombian economy since the first quarter of 2023.
- In the United States, the most relevant data of the day has been the July retail saleswhich grew by 1% on a monthly basis after falling by 0.2% in June. This figure is better than the 0.3% increase forecast by experts.
Economic indicator
Gross Domestic Product (YoY)
The Gross Domestic Product (GDP), published by the Bank of the Republic of Colombiais the broadest measure of economic activity, and is a key indicator of Colombia’s economic health. Quarterly percentage changes in GDP show the pace of growth of the total economy. Above-expected readings should be interpreted as positive/upward for the COP, while below-expected readings should be interpreted as negative/downward for the COP.
Latest Post: Thu Aug 15, 2024 16:00
Frequency: Quarterly
Current: 2.1%
Dear: –
Previous: 0.7%
Why is it important for operators?
US Dollar FAQs
The United States Dollar (USD) is the official currency of the United States of America, and the de facto currency of a significant number of other countries where it is in circulation alongside local banknotes. As of 2022, it is the most traded currency in the world, accounting for over 88% of all global foreign exchange transactions, equivalent to an average of $6.6 trillion in daily transactions. Following World War II, the USD took over from the British Pound as the world’s reserve currency.
The single most important factor influencing the value of the US dollar is monetary policy, which is determined by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability (control inflation) and to promote full employment. Its main tool for achieving these two goals is to adjust interest rates. When prices rise too quickly and inflation exceeds the Fed’s 2% target, the Fed raises rates, which helps the dollar. When inflation falls below 2% or the unemployment rate is too high, the Fed can lower interest rates, which weighs on the dollar.
In extreme situations, the Federal Reserve can also print more dollars and enact quantitative easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a jammed financial system. It is an unconventional policy measure used when credit has dried up because banks are not lending to each other (for fear of counterparty default). It is a last resort when simply lowering interest rates is unlikely to achieve the necessary result. It was the Fed’s weapon of choice to combat the credit crunch that occurred during the Great Financial Crisis of 2008. It involves the Fed printing more dollars and using them to buy US government bonds, primarily from financial institutions. QE typically leads to a weakening of the US dollar.
Quantitative tightening (QT) is the reverse process whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal of maturing securities in new purchases. It is generally positive for the US dollar.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
