The price of the Colombian peso moderates this Tuesday after five consecutive days of increases. The USD/COP reached a year and a half low of 3,740.25 yesterday, Monday, and today, Tuesday, it moves between a daily low of 3,755.83 and a high of 3,775.94.
The USD/COP is currently trading above 3,769.25, losing 0.11% on the day, although recovering ground compared to yesterday's lows.
US inflation could generate volatility in the Colombian peso
- The United States will publish its inflation data for the month of March this Wednesday. A higher than expected figure could strengthen the dollar and delay the Fed's first interest rate cut, while a considerable moderation could weaken the greenback against the Colombian peso. The market expects headline CPI to rise to 3.4% annually from 3.2% previously, while core inflation is expected to moderate to 3.7% from 3.8% in February.
- Colombia published its inflation figures on Friday, showing an annual CPI of 7.36% in March compared to 7.74% in February, slightly worsening market expectations, which expected it to moderate to 7.34%.
- The inflation data is taken as a reference for the actions of the Bank of the Republic of Colombia, which could stop the decrease in interest rates at its next meeting on April 30 if it considers that the CPI did not relax enough.
economic indicator
Consumer Price Index (YoY)
The CPI is published on US Labor Department and measures price movements through the comparison between retail prices of a representative basket of goods and services. The purchasing power of the dollar is diminished due to inflation. The CPI is a key indicator for measuring inflation and purchasing trends. A reading above expectations is bullish for the dollar, while a reading below is bearish.
Next post: Wed Apr 10, 2024 12:30
Frequency: Monthly
Dear: 3.4%
Previous: 3.2%
Fountain: US Bureau of Labor Statistics
The US Federal Reserve has a dual mandate of maintaining price stability and maximum employment. According to such mandate, inflation should be at around 2% YoY and has become the weakest pillar of the central bank's directive ever since the world suffered a pandemic, which extends to these days. Price pressures keep rising amid supply-chain issues and bottlenecks, with the Consumer Price Index (CPI) hanging at multi-decade highs. The Fed has already taken measures to tame inflation and is expected to maintain an aggressive stance in the foreseeable future.
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.
